The Australian Securities and Investments Commission (ASIC) has permanently banned former New South Wales financial adviser Ashley Grant Howard from providing financial services after an investigation found he had:
- engaged in dishonest conduct
- held out that trading he was conducting was authorised
- provided financial services when not licensed or authorised to do so
- engaged in conduct that was likely to mislead.
ASIC found Howard had failed to comply with the Corporations Act in that he:
- used more than $1.8 million of client funds for his own benefit or the benefit of others (which included paying for cosmetic surgery for his partner, purchasing a house and settling debts to Jordan Belfort, the so-called “Wolf of Wall Street”)
- provided false information and documents to clients and third parties.
ASIC also found that Howard had failed to:
- assist his trustee in bankruptcy by not lodging a statement of affairs
- assist the liquidator of Meridien Capital Ltd, a company of which he was a director, by not providing a report as to the company’s affairs, not providing information as reasonably required and directed by the liquidator and did not produce the books and records of the company
- comply with notices served by ASIC to produce documents and attend an examination.
Howard’s dishonest unauthorised use of the $1.8 million from clients led to ASIC finding that he was not of good fame and character.
ASIC commissioner John Price says: “ASIC will take action to remove persons from the financial services industry to protect the public. Mr Howard’s conduct was particularly bad in that, on occasions, he preyed on elderly and vulnerable people.”
Howard has the right to appeal to the Administrative Appeals Tribunal for a review of ASIC’s decision.
In 2014, ASIC began an investigation into the circumstances surrounding the misappropriation of funds from the initial public offering for Elsmore Resources Limited. Elsmore listed on the ASX on December 20, 2013 at a time when Howard was a director.
During the course of the investigation, ASIC became concerned about the conduct of various individuals, including Howard’s, which led to his permanent banning from providing financial services.
Shaun Morgan, a New Zealand national, also came to ASIC’s attention during the investigation and led ASIC to issue a public warning notice about him and his companies. Subsequently, last year ASIC permanently banned Morgan from providing financial services and he was removed as a director from various Australian companies in light of his criminal conviction in the United States.
Elsmore itself has pursued legal action to recover the allegedly misappropriated funds from Howard and his associates, Periwinkle Investments, HF Global Corporate Financial and Harry Fung. Howard is currently a bankrupt, which has affected the ability of the company to enforce a settlement agreement entered into with Howard requiring him to repay the misappropriated funds.
Most recently the Supreme Court of NSW ordered Fung to pay approximately $680,000 to the company.
Elsmore Resources Limited was delisted by the ASX on August 15, 2016.
ASIC’s investigations into Howard and other associated individuals continue.