Mr Barry Patrick, 73, of Sunbury, Victoria has pleaded guilty to six charges in the County Court of Victoria following an ASIC investigation. 

The charges relate to Mr Patrick's conduct in carrying on a financial services business without a licence, and obtaining property and a financial advantage by deception.

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

To obtain funds for the property development projects, he persuaded investors to refinance their homes and/or establish self-managed superannuation funds (SMSF) and then invest their SMSF in the developments.

Between 2007 and 2010, Mr Patrick illegally obtained more than $600,000 from 14 investors to fund the property developments.

The funds raised by Mr Patrick were not used to develop the properties but were instead used to pay interest payments to past and existing investors and to meet repayments on loans, as well as for personal use.  

In total, Mr Patrick pleaded guilty 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Five additional charges were withdrawn by the prosecution as a result of the guilty plea.

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.

Background

Mr Patrick was charged in July 2014 (refer: 14-166 MR).

In 2012, in response to the growth in SMSFs, ASIC established the SMSF Taskforce. The Taskforce continues to examine high-risk and emerging SMSF issues such as property spruiking to SMSFs, unlicensed conduct and false and misleading advertising of SMSFs. 

SMSF's continue to be a strong focus of ASIC's enforcement work. Recent actions include:

• Mr George John Nowak was charged with thirty one counts of deception and one count of dishonest dealings with documents relating to his conduct in dealing with members of SMSFs) who were undertaking property purchases offered by companies of which he was a director, including EJ Property Developments Pty Ltd (refer 16-135MR);
• ASIC accepted an enforceable undertaking (EU) from CMH Financial Group Pty Ltd and the sole director, Daniel White, after an ASIC surveillance found CMH had failed to provide advice about self-managed superannuation funds that was appropriate and in the best interests of clients (refer 16-097MR);
• Ms Sarah Jane Busteed was charged with three counts of dishonestly obtaining a financial advantage by deception and one count of dealing with over $100,000 that was the proceeds of crime (refer: 16-040MR);
• Superannuation Warehouse Australia Pty Ltd was ordered to pay a penalty of $25,000 for false and misleading“Free SMSF Setup” advertising (refer: 15-332MR)
• The Supreme Court of NSW found Park Trent Properties Group Pty Ltd had been unlawfully carrying on a financial services business for over five years by providing advice to clients to purchase investment properties through a SMSF (refer: 15-300MR);
• Dixon Advisory Group Limited complied with two ASIC infringement notices, paying two $10,200 penalties after including potentially misleading claims on its website (refer: 15-207MR);
• The credit licence of Queensland-based Smithson & Baye was cancelled following an investigation into a property and SMSF promoting group (refer: 15-228MR);
• ASIC released two information sheets to improve the quality of advice provided by advisers on  SMSFs: Information Sheet 205Advice on self-managed superannuation funds: Disclosure of risks (INFO 205) and Information Sheet 206 Advice on self-managed superannuation funds: Disclosure of costs (INFO 206);
• Omniwealth Services paid a $10,200 penalty for potentially misleading claims on its website (refer: 15-190MR);
• The principal of Sherwin Financial Planners, Bradley Thomas Sherwin, was charged with fraud. The charges relate to the use of SMSFs of former clients of Sherwin Financial Planners (refer: 15-158MR);
• The Federal Court of Australia ruled that Craig Gore and several other parties and financial services businesses, including Queensland-based ActiveSuper and Royale Capital, contravened sections of the Corporations Act or were knowingly concerned in those contraventions. (refer: 15-134MR);
• Australian Financial Planning Solutions Pty Ltd paid $10,200 in penalties for potentially misleading SMSF ads (refer: 15-052MR);
• ASIC banned the founder of the Charterhill Group of Companies, George Nowak, from providing financial services until 3 July 2017 on the basis that Mr Nowak is an undischarged bankrupt (refer: 15-048MR);
• Interprac Financial Planning agreed to address ASIC concerns relating to advice provided to some clients about SMSFs (refer: 14-258MR);
• Sentry Financial Services agreed to address ASIC concerns about SMSF advice provided to clients (refer: 14-109MR);
• SuperHelp Australia paid a $10,200 penalty after making potentially misleading statements about the cost of setting up SMSF (refer: 14-051MR);
• Media Super paid $10,200 in penalties for potentially misleading SMSF ads (refer: 14-001MR);
• Spring Financial Group entered into an enforceable undertaking following ASIC concerns about the level of monitoring and supervision of its representatives (refer: 13-263MR); and
• Anne Street Partners agreed to engage an independent expert following ASIC concerns about SMSF advice provided to clients (refer: 13-248MR); and
• publishing Report 337 Improving the quality of advice given to SMSF investors. (refer: 13-081MR).