ASIC obtains court order against investment scam
A Gold Coast-based unlicensed financial services business has been issued interim court orders by the Australian Securities and Investments Commission (ASIC).
Justice Applegarth of the Supreme Court of Queensland granted ex parte injunctions against Golden Sparrow Pty Ltd, GS Contracting Pty Ltd (GS Contracting) and Michelle Margaret Bruhn on 14 November 2011 after an ASIC investigation found that more than 20 investors lost approximately $250,000 as a result fraudulent activity by the company.
On 23 November Justice Applegarth continued the orders to 30 January 2012, at which time the court will hear ASIC's application for final orders.
The regulatory body alleged that Golden Sparrow used cold calling and a website to ask investors to deposit funds into a number of bank accounts held in the names of Golden Sparrow and GS Contracting, with the promise that funds would be used to buy shares on behalf of the investors, generating returns of between 1 and 3 per cent per week.
ASIC also claimed that as sole director of the two companies, Bruhn withdrew money from company bank accounts.
Between mid-August to late October 201, approximately $290,000 was deposited by investors into these accounts while $250,000 was withdrawn in cash, meaning it is likely the funds may not be recovered, ASIC stated.
In accordance with the condition of the interim orders, Golden Sparrow, GS Contracting and Bruhn must suspend all internet websites within their power or control which promote, advertise or offer financial services. The orders have also frozen $38,000 of the remaining funds.
ASIC is continuing its investigation into the alleged investment scam, together with the Queensland Police Service and the Australian Crime Commission.
According to ASIC and State and Territory police services, there has been an increase in fraudulent activity over the last nine months. While companies behind these particular types of scams are predominantly based on the Gold Coast, investors have been warned to stay vigilant.
AUTHOR
Andrew Tsanadis
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