Tuesday 27 March 2007 LAWFUEL -Australia Business + Law – The Federal Court of Australia has made orders against Mr Karl Heinz Hermann Veljkovic, of Beaconsfield, Victoria, banning him for 20 years from carrying on a financial services business. Mr Veljkovic was also banned from parting with any funds that have come into his possession by issuing, selling or offering a financial product, and from managing corporations for a period of 20 years.
The orders, which were made by consent, followed an application made by the Australian Securities and Investments Commission (ASIC). On 6 February 2007, the Federal Court issued orders in the same terms against Mr Veljkovic’s former business partner, Mr Barry John Patrick, of Pakenham, Victoria. ASIC has alleged that between May 2003 and January 2006, Mr Veljkovic and Mr Patrick had advised investors to roll over their superannuation into self-managed funds and then invest those funds in companies either operated by or associated with Mr Veljkovic and Mr Patrick.
These companies included EKB Properties Pty Ltd, Sandgrove Specialised Securities Ltd and Cardinia Specialised Securities Ltd. None of the investors have been repaid. ASIC is also seeking orders that Messrs Veljkovic and Patrick be found guilty of contempt of court after allegedly breaching previous orders made by the Federal Court on 11 October 2001. The Federal Court at Melbourne has adjourned the application for contempt to a date to be fixed.
On 11 October 2001, the Federal Court made orders by consent that Mr Veljkovic and Mr Patrick be restrained until 11 October 2006 from: • soliciting money from a regulated superannuation fund for an unregistered managed investment scheme; • carrying on an unlicensed securities business which involves the soliciting of money from a regulated superannuation fund; and, • carrying on an unlicensed investment advice business which comprises advice to a regulated superannuation fund (ASIC media release 01/366 refers).
On 6 February 2007, the Federal Court made orders for the winding-up of EKB Properties Pty Ltd, Sandgrove Specialised Securities Ltd and Cardinia Specialised Securities Ltd and the appointment of Messrs Simon Wallace-Smith and Timothy Bryce Norman of Deloitte as official liquidators to those companies (ASIC media release 07-29 refers). ASIC also obtained consent orders against Mr Patrick and Mr Veljkovic banning them for a period of 20 years from: • carrying on a financial services business; • parting with any funds that have come into their possession by them issuing, selling or offering a financial product; and • from managing corporations. While Mr Patrick consented to the 20-year banning period, Mr Veljkovic agreed to an interlocutory injunction in those terms, pending the outcome of ASIC’s court action against him. This action is now concluded as a result of the above orders being made. For further information contact: Allen Turton Deputy Executive Director, Enforcement Telephone: 02 9911 2338 Mobile: 0411 549 236 Michael van Maanen ASIC Media Unit Telephone: 02 9911 2658 Mobile: 0412 500 351 Page