ASIC takes property spruikers to the Federal Court

by Julia Corderoy15 Sep 2015
ASIC has obtained an urgent injunction in the Federal Court of Australia against three companies involved in spruiking an investment property scheme.

The injunctions will prohibit Macro Realty Developments, Property Tuition (21st Century Property) and Education Holdings (21st Century Education) from promoting and marketing a proposed Pilbara property investment, which included a seminar that was to be held for prospective investors on 10 September 2015, until further order.

ASIC alleges that the proposed Pilbara property investment was marketed and promoted by 21st Century Property and 21st Century Education using the tagline “Do you know how to buy Australian property, no money down?”

The proposed investment was to involve investors being appointed as directors and shareholders of a company and creating a trust. The company would then acquire certain properties from Macro in Newman Estate, Western Australia.  The investors were to be paid a director's fee, but agreed that Macro would be the sole decision-maker for the company. 

According to ASIC, by agreeing to become a director of a company where Macro will remain the sole decision-maker for all business associated with the company, 21st Century and Macro are counselling and procuring investors to contravene their director's duties under the Corporations Act.

ASIC also alleges that the investment documents in relation to the proposed Pilbara property investment are misleading and deceptive, and that the investment proposal is a financial product.

The matter is set down for final hearing on 26 October 2015 where ASIC will ask the Court to make declarations that the defendants contravened the Corporations Act, and for the injunctions against Macro, 21st Century Education and 21st Century Property to be made permanent.
 

COMMENTS