VOFF alleges that ASIC gave criminal an AFSL
Victims of Financial Fraud (VOFF) has added to its litany of accusations against the Australian Securities and Investments Commission (ASIC), alleging that the regulator failed to acknowledge that it allowed known criminals into the financial system regarding the Trio Capital fraud.
The organisation claimed that ASIC failed to check the bona fides of Shawn Richard before granting him an Australian Financial Services Licence (AFSL), which it said was “a decisive moment in the Trio fraud”.
It alleged that Richard was “unqualified and not the educated person he claimed to be” and “also had a history of boiler room activity in Taiwan”. The NSW Supreme Court later found that Richard set up the Trio scheme to “deliberately steal Mum’s and Dad’s superannuation and investment savings”.
VOFF questioned why in over eight years of investigating Trio, ASIC did not find a cent of stolen money, despite the above court finding.
It acknowledged that perhaps the answer could relate to the ability of criminals to conceal crimes that occurred overseas, with Australians and Australian regulators being unable to verify the bona fides of any investment in offshore jurisdictions.
VOFF alleged, however, that ASIC had continued to lie to investors about what happened in Trio. It said that rather than addressing the crime, the regulator responded by “bringing down” a family-run financial advisory business, which then cast doubt on all investors who lost money in Trio – this perpetrated the lie that “it was poor advice”.
As VOFF had previously said, the group filed a Freedom of Information response for details about Trio and were told by both the Australian Prudential Regulation Authority (APRA) and the Treasury Department that they are unable to provide information as it would “allow persons with malicious intentions to identify gaps and loopholes in the legislation that limit APRA’s powers”.
VOFF again questioned why this was the case, insinuating that this claim actually hid dishonest intent.
“Did the government make a formal decision to withhold evidence of a crime and abandon the Trio victims for the sake of maintaining consumer confidence in the Australian financial system and ASIC?” the group asked.
“Are uncompensated Trio victims the sacrificial lambs to maintain this illusion? When is ASIC going to come clean about its handling of the Trio matter and explain why it withheld information and evidence surrounding the fraud from a government enquiry, a court case and the victims?”
AUTHOR
Hannah Wootton
Recommended for you
ASIC has released the results of its first adviser exam to be held in 2025, with 241 candidates attempting the test.
Quarterly Wealth Data analysis has uncovered positive improvements in financial adviser numbers compared with losses in the prior corresponding period.
Holding portfolios that are too complex or personalised can be a detractor for acquirers of financial advice firms as they require too much effort to maintain post-acquisition.
As the financial advice profession continues to wait on further DBFO legislation, industry commentators have encouraged advisers to act now in driving practice efficiency.
