Assets freeze for Westpoint directors

The Federal Court of Australia in Perth has granted an application by the Australian Securities and Investments Commission (ASIC) and issued interim asset freezing orders against the four directors of Westpoint.

Under the order, Norman Carey, Graeme Rundle, John Dixon, and Cedric Beck have been prevented from disposing of any assets held legally or beneficially by them until 5.00 pm on April 7, 2006. The four directors have also been prohibited from leaving Australia or even venturing within 100 metres of an overseas departure point in the country until the same date.

Furthermore, a cap has been placed on the amount of money each director can spend on ordinary operating and living expenses for the same period.

The Court also granted interim asset freezing orders against Richstar Enterprises, Westpoint Realty, Bowesco, and Redchime, all of which are companies associated with Norman Carey.

The regulator’s most recent action comes in response to monies owed to Westpoint Corporation, which is in the process of receivership and liquidation, and investors in the company after the collapse of the organisation’s mezzanine investment product. During ASIC’s investigation into the company’s activities it found transactions were entered into just prior to the appointment of receivers and liquidators that reduced the overall asset position of the Westpoint group in favour of the four companies named.

ASIC’s investigation is continuing, and the proceedings against Westpoint are scheduled to return to Perth’s Federal Court of Australia on April 7, 2006, at 11.00 am.

In other news, the promoters of Money for Living, a home equity release scheme, have appeared in the Melbourne Magistrates Court on charges brought by ASIC.

Stephen O’Neill has been charged with four counts of obtaining financial advantage by deception, four counts of using his position as an officer of a corporation dishonestly, and two counts of managing a corporation while disqualified.

Four counts of obtaining financial advantage by deception have also been brought against Gary O’Neill, along with seven counts of dishonestly using his position as a director of a corporation.

Both defendants were released on bail and are scheduled to reappear in the Melbourne Magistrates Court on April 20, 2006.

The prosecution, being performed by the Commonwealth Director of Prosecutions, is the result of an ASIC investigation that alleged the brothers obtained approximately $1 million in mortgages via loan applications that did not disclose the life tendencies associated with the mortgaged properties during their involvement with Money for Living and MFL Property Holdings.