Monday 28 August 2006 06 – LAWFUEL – Law News Network – Following an…

Monday 28 August 2006 06 – LAWFUEL – Law News Network – Following an application by the Australian Securities and Investments Commission (ASIC), the Supreme Court of Queensland at Brisbane has made a declaration that Mr David Jeremiah Palmer and companies related to him (the Intertax Group) operated an unregistered managed investments scheme (Scheme) in breach of the Corporations Act (the Act). His Honour, Mr Justice Fryberg, also ordered that Mr Gerald Collins and Mr Matthew Joiner of Jefferson Collins Joiner, Chartered Accountants be appointed joint and several liquidators to wind up the members of the Intertax Group and the Scheme. The Court accepted ASIC’s submission that the several funds operated by the Intertax Group constituted one overall Scheme. Previously, Messrs Collins and Joiner had been appointed as investigative accountants to prepare a report for the court in relation to certain matters concerning the affairs of the Intertax Group. In their report, Messrs Collins and Joiner concluded that: • the Scheme was insolvent; • the investors in the Scheme are owed in the order of $14 million; • there are grounds to suspect that Mr Palmer and the Intertax Group have contravened the Act and ASIC Act; and • the liabilities of the Scheme exceed its assets by approximately $9.7 million. At the hearing, the Court considered a proposal for the winding up of the Scheme put forward by Mr Palmer and supported by investors. Justice Fryberg was of the view that the proposal was a continuation of the unregistered managed investment schemes and ‘seriously doubted whether the proposal could be lawfully carried out’. The proceedings, relating to the application for declarations in relation to Mr Max Collins and Mr Philip Trudgeon, who are directors of two of the members of the Intertax Group, have been adjourned to a date to be fixed. Background On 6 June 2006, ASIC filed an application with the Supreme Court of Queensland seeking orders against an unregistered investment Scheme being operated by the Intertax Group. The proceedings were commenced as a result of information received by ASIC during the conduct of an investigation into the affairs of Mr Palmer and companies related to him. The information gave ASIC reason to believe that members of the Intertax Group may have operated an unregistered managed investment scheme in breach of the Act.
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ASIC’s investigations have revealed that the Intertax Group has established at least four funds for managed investment projects. The projects were marketed to clients of Intertax, a Brisbane accounting firm. ASIC understands approximately 150 investors, located predominately in south-east Queensland, were offered returns between 12 to 50 per cent per annum, depending on the financial position of the Intertax Group at the time. For further information contact: Jan Redfern Executive Director, Enforcement Telephone: 02 9911 2191 Mobile: 0411 119 210 Emma Forehan ASIC Media Unit Telephone: 03 9280 3354 Mobile: 0409 702 310