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Property developer and strip-club owner charged with fraud

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Lucy Dean 3 minute read

A property developer and operator of Hobart’s Men’s Galley and Launceston’s Show Girls has been charged with fraud and dishonesty offences after engaging elderly victims in a Ponzi scheme involving low-doc loans.

Mr Bradley Keith Silver, director of Gold Coast property development company Capital Growth International Club, was charged by the Australian Securities and Investments Commission (ASIC) on Friday with seven counts of fraud to the value of $2.32 million, with a maximum sentence of 12 years' imprisonment.

Additionally, he was charged with six counts of dishonest use of his position as a director, with a maximum sentence of five years in jail.

He was found to have encouraged elderly victims with little to no income or appropriate documentation to invest in a low-risk, high-return scheme, with promised returns of up to 20 per cent per annum.

Between 2008 and 2011, Mr Silver was director at Capital Growth International Club and associated with All About Property Development. However, in February 2011, both companies were liquidated, with investors owed about $9 million.

The investors were predominantly elderly, with some over 100 years old.

Mr Silver was arrested at Brisbane Airport on 20 July 2017 and brought before the Brisbane Magistrates Court the same day.

He has been released on conditional bail and will appear in the Brisbane Magistrates Court on 25 August 2017.

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

Westpac involvement

In February this year, David St Pierre, former Westpac home finance manager, was sentenced to three years' imprisonment for his part in the fraud.

He was found to have encouraged the “elderly and vulnerable” victims with “limited financial means” to borrow against their homes (some of which were unencumbered) and invest in Capital Growth International Club and All About Property Development. Returns were promised at 12 per cent to 20 per cent per annum; however, interest payments ceased shortly before the liquidator was appointed on 28 February 2011.

Victims who received Westpac loans through Mr St Pierre have been compensated by the bank, as well as investors who claimed to have direct contact with Mr St Pierre before investing in Capital Growth International Club.

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In November 2012, a senate enquiry into the banking sector post-GFC raised the issue of low-doc loans and reverse mortgages with Westpac. Senator John Williams claimed some victims had been approached by Bradley Keith Silver and his father, Tony Silver, while residing in aged care homes.

Senator Williams related: “Mrs Heather Simmers, who is now 101 years old, was signed up personally by your bank manager for a 30-year mortgage, for $440,000, at the Clem Jones nursing home in Brisbane.

The senator recounted the story told by one lady who worked for the company: “As witnessed by me and her daughter, Mrs Del Black, approximately 70 years old, who had a similar Rocket loan, both mother and daughter are aged pensioners with no other income.

"I was ordered by Tony and Brad Silver to drive the bank manager to that location. I picked him up at Oxenford that day and also saw the vehicle which he had been awarded for his valuable contributions to the company, Capital Growth International Club Pty Ltd. This was [a] white Mazda CX-9 vehicle, a 2010 model worth about $50,000. This gift was confirmed by Tony Silver, who stated that a sale was concocted again, according to Silver, to protect the bank manager from any consequences from accepting such items.”

Senator Williams said, "Well, this company went broke. This lady is now 101 years old.”

The senator urged Jim Tate, the acting chief operating officer, Australian Financial Services, Westpac Group, to address the case, noting that Mrs Simmers had, at the time, recently recovered from a brain tumour operation.

[Related: Westpac boss grilled over jailed home loan manager]

Property developer and strip-club owner charged with fraud
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