Indefinite ban for Gold Coast financial adviser
A GOLD Coast man investigated over an alleged Ponzi scheme that left investors $60 million out of pocket has been banned indefinitely from working as a financial adviser.
Crime and Court
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A GOLD Coast man investigated over an alleged Ponzi scheme that left investors $60 million out of pocket has been banned indefinitely by the Supreme Court from working as a financial adviser.
Corporate watchdog ASIC, who has twice unsuccessfully tried to prosecute Dr Roger Munro over the huge losses, instead took him to court for operating a financial services business without a licence.
ASIC also alleged his wife Kathleen Munro had also been carrying on a financial services business without the proper licence, or aiding or abetting Dr Munro to do so.
They alleged that since August 2011 the pair had operated an unlicensed financial services business in Australia and raised over $1.5 million from investors, friends and family for trading purposes.
During the trial, three investors gave evidence that Dr Munro approached them about investing in a trading group, which he subsequently called Tradestation Futures, which they paid money towards.
Investors told the court they received quarterly returns from Dr Munro for a period, but that each is still owed significant sums by Dr Munro, including one who is owed $500,000.
In a statement, ASIC said the Supreme Court did not accept Dr Munro’s assertion in defending the matter that the funds were advanced by the investors as unsecured personal loans to TradeStation or Tradestation futures.
The Court found that the arrangement between the investors and Dr Munro was one by which Dr Munro was seeking to trade on behalf of investors using pooled funds.
The court found Dr Munro had breached the Corporations Act and ordered that he be permanently restrained from carrying on a financial services business in this jurisdiction, without holding an AFS licence.
In making the declaration, the judgement said Dr Munro “has sought and obtained funds from investors within Australia who have paid him large sums of money for trading in international markets in circumstances where he does not hold an AFSL.
“In such circumstances the public interest and the marking of the Court’s disapproval of such conduct makes it appropriate to grant some form of declaratory relief”.
The orders made by the court do not prevent Dr Munro or Kathleen Munro from returning money to past investors.
A disclosure order was also made by the Court on August 7 which required Dr Munro to provide ASIC with information about his fundraising activities and the location of investor funds. This matter remains before the court.
Dr Munro and Kathleen Munro were ordered to pay ASIC’s costs of the proceeding.
Commissioner Greg Tanzer warned investors to check the licences of their advisers before paying them anything.
“Consumers should not invest with a person or entity in Australia unless they are authorised by, or hold an, AFS Licence,” he said.
“The Australian financial services licensing regimen provides safeguards for consumers, including adequate compensation arrangements for retail clients.”
ASIC’s investigation is continuing.
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