The Supreme Court of Victoria has found a number of superannuation and property developments companies associated with the PFS Group in breach of the Corporations Act.
Yesterday, the Australian Securities and Investments Commission sought declarations that Shaun White, Nicole White, Damian Tolson and companies within the PFS Group contravened provisions of the Corporations Act and the ASIC Act relating to misleading and false conduct, breaches of directors duties and the provision of financial services.
The Court decision follows action taken by ASIC to have 11 PFS Group companies placed into liquidation by the Supreme Court on December 08, 2005, as well as restraining White, White and Tolson from carrying on business relating to superannuation.
ASIC alleged, among other things, that the PFS Group misled investors and acted unconscionably, leading investors to roll over approximately $800,000 of existing superannuation funds into self-managed superannuation funds that the PFS Group established for them, while also persuading investors to invest a further $700,000 into joint venture investments with the PFS Group.
Yesterday, the Court found that White, White and Tolson and eight of the defendant companies in the PFS Group had carried on an unlicensed financial services business.
The eight companies are now in liquidation, including the PFS Business Development Group Pty Ltd, PFS Construction Consulting Group Pty Ltd, PFS Construction Consulting Group (Ashridge Lane A) Pty Ltd, PFS Construction Consulting Group (Ashridge Lane B) Pty Ltd, Kaluski White & Associates (Black Gully Road) Limited, Meridian Event Management Pty Ltd, Nycam Werd Pty Ltd and Kaluski White & Associates Pty Ltd.
ASIC also found that the three personal defendants together with seven of the defendant companies had engaged in a variety of activities that were misleading and deceptive.
“The victims of the false and deceptive conduct included beneficiaries of self managed superannuation funds, investors in property developments and employees of the defendant companies,” ASIC said.
The Court also found that both Shaun White and Nicole White and Damien Tolson had their directors’ duties.
While Tolson was found to have breached his duties by gross negligence, the Court found that White and White had failed to discharge their duties in good faith, citing various acts of dishonesty as the basis for such findings.
The Court will consider the penalties to be imposed as a result of today’s findings on June 20, 2006.
ASIC’s investigation is continuing.
By Nelson Yap
