Mortgage broker exposed
The owner of a Melbourne-based mortgage broking company has been found guilty of operating an illegal managed investment scheme, owing 55 investors more than $35 million.
The Federal Court of Australia declared that Peter Berlowitz’s HLP Group was operating an unregistered managed investment scheme, with Justice Finkelstein saying he hoped the declaration would alert investors to their predicament.
The Australian Securities and Investments Commission (ASIC) investigations revealed that 55 individuals invested a total $5 million in the scheme between April 1, 2005, and September 15, 2005.
The HLP Group, comprised of HLP Financial Planning, Leaberl and Beachmere View, was liquidated in February this year, and appointed insolvency expert Ferrier Hodgson said investors are unlikely to recover any of the $35 million they are owed.
Ferrier Hodgson also found Berlowitz, a former executive with loan broker Esanda, had spent hundreds of thousands of dollars on 12 luxury cars, including a $521,000 Ferrari, a $237,000 Porsche and six BMWs. The cars were driven by Berlowitz, his wife, parents and a fellow director.
ASIC, which was alerted to the scheme by aggrieved investors, said it would now consider whether to proceed with criminal action against Berlowitz personally.
Recommended for you
The FSCP has announced its latest verdict, suspending an adviser’s registration for failing to comply with his obligations when providing advice to three clients.
Having sold Madison to Infocus earlier this year, Clime has now set up a new financial advice licensee with eight advisers.
With licensees such as Insignia looking to AI for advice efficiencies, they are being urged to write clear AI policies as soon as possible to prevent a “Wild West” of providers being used by their practices.
Iress has revealed the number of clients per adviser that top advice firms serve, as well as how many client meetings they conduct each week.
