Ex-Goldman Sachs custodian banned
A former responsible officer of Goldman Sachs JBWere subsidiary Invia Custodian has been permanently banned from providing financial services for misappropriating company funds.
The Australian Securities and Investments Commission (ASIC) banned Christopher Despotelis, 47 of Docklands, Victoria, for misappropriating Invia trust funds totalling $40,689 between June 24 and July 14 last year.
Despotelis was head of custody at Invia from March 11 to July 20 last year, when he was removed as a responsible officer at the firm.
A wholly-owned subsidiary of Goldman Sachs JBWere Capital Markets Limited, Invia provides a custody service to a broad range of investor clients.
ASIC found that Despotelis asked fellow Invia employees on three occasions to sign cheques drawn on Invia's bank accounts. The cheques were all made out to fictitious names, which were later altered to reflect his own name.
Despotelis has since repaid the misappropriated funds in full to the company, which has terminated his employment.
He has the right to lodge an application with the Administrative Appeals Tribunal for a review of ASIC's decision.
Meanwhile, a former head of Brisbane-based accounting firm Harts Australasia has been jailed for seven years for tax fraud.
The Brisbane District Court found Steven Irvine Hart, 53, of Sunnybank, guilty of nine counts of defrauding the Commonwealth and one of misappropriating $335,000.
It convicted Hart of fraudulently marketing a tax planning arrangement to clients in 1990 that the presiding judge said in sentencing had caused clients “enormous financial hardship and stress”.
The arrangement was marketed by Hart as a way for clients to enjoy tax deductions as well as providing a significant cash benefit at the end of a 10 year period.
Employer clients were also encouraged under the arrangement to buy insurance bonds on behalf of staff to motivate them to remain in their employ for 10 years. Staff were to receive the proceeds of these bonds on maturity.
Hart asked clients to contribute some of their own money, and he also provided them with false loans from a company he controlled to purchase the bonds.
Instead of purchasing any legitimate bonds, however, Hart falsified documents and used fraudulent polices to make the bonds and loans issued in the arrangement appear legitimate.
The arrangement was queried by the Australian Taxation Office in 1997 and, following an extensive joint investigation with the Australian Federal Police, Hart was arrested in October 2001.
Recommended for you
As the year draws to a close, a new report has explored the key trends and areas of focus for financial advisers over the last 12 months.
Assured Support explores five tips to help financial advisers embed compliance into the heart of their business, with 2025 set to see further regulatory change.
David Sipina has been sentenced to three years under an intensive correction order for his role in the unlicensed Courtenay House financial services.
As AFSLs endeavour to meet their breach reporting obligations, a legal expert has emphasised why robust documentation will prove fruitful, particularly in the face of potential regulatory investigations.
