Mayfair 101 boss fails to have elements of ASIC case removed in advance of retrial

A court has blocked Mayfair 101 boss James Mawhinney from removing key claims against him made by the corporate regulator, ahead of a retrial.

James Mawhinney, centre, and members of his legal team outside the Melbourne Magistrates Court at an earlier hearing. Picture: Luis Enrique Ascui

The Federal Court has blocked Mayfair 101 boss James Mawhinney from scrapping key claims by the corporate regulator, but has succeeded in having elements of the agency’s earlier case re-examined.

Justice David O’Callaghan dismissed two applications made by Mr Mawhinney on Friday, but granted his request to block evidence from the Australian Securities and Investments Commission.

ASIC and Mr Mawhinney will face off in a retrial after the regulator initially secured bans against the Mayfair 101 boss.

Mr Mawhinney successfully remitted earlier rulings by the Federal Court, overturning lifetime bans on advertising for financial services imposed by Justice Stewart Anderson.

But Justice O’Callaghan said he would block Mr Mawhinney’s two applications to strike out elements of ASIC’s case, noting the Mayfair 101 boss’ move to quash finding him liable as an accessory would be at odds with the regulator’s earlier court claims.

“ASIC says that in pleading the case on accessorial liability the way that it has, it is doing

precisely what the Full Court effectively directed it to do in its reasons, in order to accord

procedural fairness to Mr Mawhinney,” Justice O’Callaghan said.

He said ASIC was not seeking to find him liable, but was seeking relief under the provisions.

Justice O’Callaghan also struck out Mr Mawhiinney’s move to brand parts of ASIC’s claims embarrassing, saying the regulator had “articulated the representations alleged … with sufficient precision to enable the defendants to understand the case to be met at trial”.

ASIC is preparing for a retrial in October, and Justice O’Callaghan noted the regulator’s claims against Mr Mawhinney.

These include allegations Mr Mawhinney participated in the operations of IPO Capital, instructing staff and interacting with investors.

ASIC also claims Mr Mawhinney “was involved in IPO Capital carrying on a financial

services business in this jurisdiction without an AFSL”.

ASIC is also taking criminal action against Mr Mawhinney, who was arrested and charged last week, over his involvement in IPO Capital

Justice O’Callaghan gave Mr Mawhinney leave to cross examine several witnesses in the retrial, including the Deloitte liquidator who had labelled his company “insolvent since inception” as well as liquidators of M101 Nominees and IPO Wealth.