Guilty plea over dodgy SMSF property deals

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A Victorian man has pleaded guilty to six charges brought against him following an Australian Securities & Investment Commission Investigation into self-managed superannuation fund (SMSF) property investments.

Barry Patrick, 73, of Sunbury, Victoria has pleaded guilty in the County Court of Victoria this week to three charges of obtaining property by deception, two charges of obtaining a financial advantage by deception and one charge of carrying on a financial services business without a licence.   

Five additional charges were withdrawn by the prosecution as a result of the guilty plea.

The ASIC investigation, carried out by the regulator’s SMSF Taskforce found that between 2007 and 2010, Patrick illegally obtained more than $600,000 from 14 investors.

To obtain the funds Patrick persuaded investors to refinance their homes and/or establish self-managed superannuation funds (SMSF) and then invest their SMSF in proposed property developments.

Patrick nominated investors to be directors of Wrestway Property Development Pty Ltd, Exclusive Property Consultants Pty Ltd, Compendium Holdings Pty Ltd and Integrated Consolidated Holdings Pty Ltd, which were formed to purchase properties at Pakenham, Lilydale, Epping and Garfield for development.

Rather than direct the funds for those purchases, Patrick used the money to pay interest payments to past and existing investors and to meet repayments on loans, as well as for personal use.  

Mr Patrick was conditionally bailed to appear before the County Court of Victoria for a plea hearing on 7 July 2016.

The matter is being prosecuted by the Commonwealth Director of Public Prosecutions.
 

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