The Australian Securities & Investment Commission (ASIC) has continued its actions against controversial land bank schemes by successfully having liquidators appointed to oversee two Victorian companies.
The Federal Court of Australialast week ruled in favour of an ASIC application, appointing Nicholas Martin and Craig Crosbie of PPB as joint liquidators of Bilkurra Investments Pty Ltd (Bilkurra) and Foscari Holdings Pty Ltd (Foscari).
Bilkurra was responsible for the Hermitage Bendigo
(formerly Acacia Banks) land banking scheme in Bagshot, Victoria, while Foscari operated a similar scheme in Truganina, Victoria,
Promoters of the land banking schemes used Bilkurra and Foscari to raise approximately $24 million from investors. These schemes were operated in similar ways to other land banking schemes associated with controversial property spruiker Jamie McIntyre.
The appointment of liquidators comes after ASIC took action against Bilkurra and Foscari in December 2015 by moving to freeze their assets and wind the two companies up.
ASIC commenced the proceedings alleging that the two companies were insolvent.
On 21 December 2015, the Federal Court made freezing orders against Bilkurra, Foscari Holdings, and Michael Grochowski from selling, charging, mortgaging or otherwise dealing with or disposing of any property of Bilkurra or Foscari until the hearing and determination of the proceeding or further order of the court.
On Friday, the Federal Court further found that Bilkurra and Foscari were knowing participants in schemes that have facilitated misappropriation of investors' funds, Michael Grochowski, who was banned by ASIC from providing financial services, had the day to day control of the companies, including by controlling the companies' bank accounts which contained investor funds, and the winding up orders were necessary to protect investors and so that there was some prospect of recovery of the monies lost after a full investigation by a liquidator.
ASIC commissioner Greg Tanzig said the regulator was committed to its ongoing investigation into landbanking schemes.
“This is another important outcome for ASIC's wider and ongoing investigation into land banking. We will continue to crack down on these investment schemes to deter further misconduct.”
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