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Compliance

Financial group taken to court by ASIC

by Reporter5 minute read
Court, scales of justice

The corporate regulator has commenced proceedings in the Supreme Court of Queensland against a business owner/former adviser and his partner over allegations that they used funds loaned to the company for personal use.

Brett Andrew Gordon traded under the business name Refocus Financial Group, which offered finance (including loan advice), tax, wealth, legal, insurance and business coaching, among other services.

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Mr Gordon and Refocus were authorised representatives of Solar Financial Advisory between 28 June 2014 and 26 August 2017.

Solar reportedly terminated Mr Gordon and Refocus as authorised representatives after becoming aware of questionable conduct and reported it to ASIC.

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Following an investigation, ASIC alleges that Mr Gordon recommended clients establish a self-managed super fund (SMSF), and then advance unsecured loans to a related company called Diverse Capital (which was placed into liquidation on 18 May 2018) in order to undertake property development.

According to ASIC, at least 10 clients loaned $1.4 million (all of which remains outstanding) to Mr Gordon on his recommendation, with Mr Gordon then using the funds “for his personal use and as working capital for Refocus”. The funds remain outstanding.

Further, ASIC alleges that Mr Gordon’s partner, Consultia Super director Heather Swift, also received funds from Diverse Capital that she, too, applied for personal use. The regulator is also commencing proceedings against Ms Swift.

Mr Gordon and Refocus also allegedly entered other unsecured loan agreements to borrow funds from Refocus’ SMSF clients, ASIC said, and Mr Gordon also continued to provide financial services after becoming unlicensed to do so.

ASIC is now seeking orders to:

  • appoint a provisional liquidator to Refocus and Consultia;
  • prevent Mr Gordon and Ms Swift from dealing with their assets; and
  • “restrain” Mr Gordon from providing financial services.

ASIC’s investigation is continuing and the matter will be heard in the Supreme Court in Brisbane on 11 July 2018.

[Related: Brokers flagged in ASIC’s scathing ‘one-stop shop’ report]

Financial group taken to court by ASIC
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