Ex-director banned for life for Trio involvement
Astarra Asset Management (AAM) director Eugene Liu has been permanently banned from providing financial services as part of the Australian Securities and Investments Commission's (ASIC's) continuing work into the collapse of Trio Capital.
Liu was charged with failing to comply with financial services law in his position as director and chief investment strategist of AAM from July 2006 until it was placed into liquidation at the end of 2009.
AAM was appointed by Trio Capital as the investment manager for assets in the Astarra Strategic Fund (ASF) — a fund of hedge funds which held Trio as its responsible entity.
In December 2009, ASF reported assets under management of $125 million which ASIC said were a result of AAM's marketing of ASF.
ASIC's investigation into Liu found he engaged in dishonest conduct and conduct that was misleading or likely to mislead in his position as AAM director.
He misled investors via incorrect statements contained in the ASF product disclosure statement and in information contained in a research report about ASF, according to ASIC.
Liu received more than $388,041 in unlawful payments as a reward for involvement in the investment of ASF assets in certain funds while hiding where ASF investment money was being placed from investors.
ASIC chairman Greg Medcraft condemned Liu's behaviour as unfit for the financial services industry.
"Mr Liu's banning should act as a deterrent to all those in the industry," he said.
"Australian investors should be confident and informed, and those individuals who do not promote these values when dealing with consumers have no place in the industry."
The Administrative Appeals Tribunal is currently reviewing ASIC's decision at Liu's behest.
Although financial planners and self-managed super fund (SMSF) trustees have been fingered by Federal officials as culpable in the Trio collapse, in January investors burned by the Trio collapse formed the Victims of Financial Fraud (VOFF) group, which vowed to get involved in the 2013 Federal election on the basis that the Federal Government and the regulators also needed to be held accountable.
In September ASIC imposed new rules for hedge funds following industry consultation into the Trio collapse. It said its investigation into Trio Capital is ongoing.
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