The Federal Court of Australia has ordered two unregistered managed investment schemes operating in New South Wales and Western Australia, promoted by GDK Financial Solutions Pty Ltd and associated companies be wound up.
The Australian Securities and Investments Commission had made an application for the three companies associated with the schemes, Windsor Village Management Pty Ltd, The Mews Village Nominees Pty Ltd, and Rosedale Village Nominees Pty Ltd to be wound up.
The orders follow a decision handed down by the Honourable Justice Finkelstein on November 2, in which he agreed that the schemes should be wound up despite objections by some defendants that the schemes had already been wound up.
The schemes were established to develop and operate retirement villages in NSW – the Rosedale Retirement Village, where a village already exists and operates and in WA – The Mews Retirement Village, where no village currently exists.
In May this year, ASIC filed an application with the Federal Court seeking orders winding up the alleged unregistered managed investment schemes and/or the winding up of the companies ASIC alleges were involved in the promotion and operation of the alleged schemes.
ASIC’s application was heard by the Justice Finkelstein on in August and September this year.
Justice Finkelstein found that investors were not given any explanation or accounting for any of the money they had contributed.
Despite numerous requests for information, he found that “the investors had simply been left in the dark”.
Justice Finkelstein ordered that receivers from KordaMentha be appointed to carry out the winding up of the schemes, and specified in his order the form the windings up should take.
“In this regard, His Honour ordered that the receiver take possession of the relevant land in WA and NSW and control of the Rosedale business and that the receiver be permitted to make application to the court to seek any other ancilliary orders to ensure that the receiver takes such possession and control,” ASIC’s executive director of enforcement directorate Jan Redfern said.
“ASIC understands they’ll be disruption to the operation of the Rosedale Retirement Village in NSW,” she added.
ASIC will continue to act to ensure that schemes which don’t comply with the law are wound up in an appropriate manner. In this instance, the court has made it clear that it wants the receivers to investigate the lack of information about the scheme provided to investors and closely supervise the receiverships,” Redfern concluded.
By Nelson Yap
