10 From 1999 the respondent purported to offer investors an opportunity to earn higher interest than the banks by seeking a minimum deposit of $5,000.00 which generated annual interest payments of 10% of the sum invested. The money invested was to provide "bridging finance" to purchasers of properties who required additional sums prior to or at the date of settlement in order to effect settlement.
Count 3
11 In 1999 the respondent asked Mr Glen Richard Taylor if he wanted to earn better interest than the banks were offering. He told Taylor that a minimum of $5,000.00 was required and that annual interest payments would be made at a rate of 10%, paid in monthly instalments. On 3 August 1999 Mr Taylor provided the respondent with a cheque for $5,000.00 to be invested for a period of 12 months with the option of withdrawing the sum invested at any time prior to the expiry of the 12 months. The respondent printed an Investment Certificate upon receipt of the cheque and assured Mr Taylor that his money was "completely safe." Mr Taylor's cheque was deposited into the Horsham Finance NAB Cheque Account on 4 August 1999. The proceeds of this deposit were used to pay a number of credit card accounts in the names of Leith Adams and Angela Adams, the wife of the respondent, in addition to sundry cheques, bills and cash withdrawals. An amount of $92.53 was withdrawn on 4 August 1999. Monthly payments of sums equalling approximately 10% pro rata commenced to be made to Mr Taylor's bank account from other sources.
Count 10
12 In November 1999 the respondent asked Mr Taylor if he wanted to invest more money with him. Taylor agreed to invest a further $10,000.00 having satisfied himself by the deposit of monthly interest cheques into his account that his investment was performing well. Again, the respondent assured Mr Taylor that his investment would be safe and he was provided with another Investment Certificate.
13 Mr Taylor's cheque for $10,000.00 was deposited into the Horsham Finance NAB Cheque Account on 22 November 1999. The proceeds of the deposit were then dissipated in a series of transfers and cheques. Mr Taylor's money was not invested, but a withdrawal against the amount he had invested was made on 22 November 1999 in the sum of $1,028.35. Mr Taylor began to receive monthly cheques of $83.00 representing "interest" payments on his investment of $15,000.00.
Count 11
14 In late September 2000 the respondent represented to Mr Taylor that he would need to increase the amount of his investment to a minimum of $20,000.00 in order to remain in the scheme. As a consequence, Mr Taylor wrote out a further cheque for $5,000.00 bringing his total investment to $20,000.00. He received a Certificate confirming his investment in this amount. That additional cheque for $5,000.00 was deposited into the Horsham Finance Trust Account on 23 October 2000. The sum of $5,000.00 was then transferred on 24 October 2000 to the E. Homes Loan Account. On 24 and 25 October 2000 the proceeds of this deposit were dissipated in a series of phone and internet transfers and cheques drawn on the Trust Account. Accounts paid for by these funds include an outstanding credit card debt, the respondent's wife's car loan, accounts with Atlas Fuels and an amount of $1,000.00 provided to an employee of the respondent, one Martin Smith.
15 Interest payments continued irregularly, finally ceasing in approximately April 2001. At a meeting held by the respondent and others in October 2001 Mr Taylor was notified that the respondent's companies were in financial difficulty and required further capital. On 6 May 2002 Mr Taylor was told by the respondent that his money would be repaid "in about three month's time".
16 None of the principal invested by Mr Taylor has been repaid to him. He did not authorise the use of the sums provided by him to the respondent for expenses personal to the respondent or his wife or to be applied to the running costs of either of the respondent's two businesses. His money was not invested as agreed.
Counts 13, 14, 16, 17, 18, 19, 20 and 21
17 Counts 13, 14, 16, 17, 18, 19, 20 and 21 involve a series of dealings entered into with the respondent by Lorna Melva Peterson.
18 In approximately October 1999 the respondent spoke to Mr Alan Edgar Peterson about investing in Horsham Finance. The respondent explained that the investment involved assisting people in obtaining home loans by providing bridging finance when settlement in relation to the property they were hoping to buy pre-dated settlement of the property they were selling, resulting in a temporary shortfall. The respondent explained that on settlement the money lent by Horsham Finance would be returned to it. He told Mr Peterson that the money invested would be available at call provided 30 days written notice was given and that the investment would generate annual interest of 10%, paid in monthly instalments.
19 On 11 October 1999 Mr Peterson gave the respondent a cheque for $2,000.00 made out to Horsham Finance. He received a Certificate of Investment. His mother, Mrs Lorna Melva Peterson, handed over a cheque for $20,000.00 at the same time and received a Certificate. Her monthly interest payments were to be $167.00. Both cheques were deposited into the Horsham Finance Cheque Account on 12 October 1999. Between 12 October and 18 October 1999 a series of cheques were written and transfers made resulting in a balance on 18 October 1999 of $5,062.59. The sum of $4,015.00 was transferred to the respondent's NAB Master Card; $4,134.00 was transferred to the respondent's NAB Visa Card Account; and $8,000.00 was transferred to the mortgage account held by the respondent's wife in reduction of her home loan**.**
20 Mrs Peterson commenced receiving monthly cheques of $167.00. Impressed with the performance of her investment her son took her back to see the respondent on 24 March 2000 to discuss investing more money in the respondent's bridging finance scheme. Mrs Peterson provided the respondent with a cheque for $40,000.00. The respondent told her that this sum would be added to the original amount invested and would be applied in the same way, i.e. as bridging finance for home loans. Her monthly interest payments were calculated to be $333.33. This cheque was deposited into the Horsham Finance Cheque Account on 24 March 2000, together with a cash deposit of $2,000.00.
21 Between 24 March and 29 March 2000 a series of cheques were drawn and transfers made resulting in a balance on 29 March 2000 of $2,593.09. The transfers and payments made in this period include the sum of $1,873.73 representing three payments to Angela Adams or credit cards held by her; a cheque for $6,970.22 deposited into the respondent's NAB Master Card Account; a cheque for $4,223.73 made out to cash; a cheque for $3,251.00 made out to Creeks Building Service in payment of renovations to the respondent's offices; and a cheque for $1,934.15 made payable to Boe-Tec representing payment for boat repairs. These payments were not authorised by Mrs Peterson and were not made pursuant to the agreement she had with the respondent.
22 Mrs Peterson never received any payments from the respondent since September 2001. The principal has not been returned to her.
Count 22
23 On or about 28 February 2000 the respondent attended the home of Jeffrey Pekin and discussed the prospect of investing in Horsham Finance with him. His wife was also present. The respondent told them that if they invested $10,000.00 they would be assisting other people to obtain bank finance and in return they would receive annual interest of 10% of their investment, paid in monthly instalments. He assured them that their investment would be safe. The following day the Pekins provided the respondent with $10,000.00 and received a Certificate acknowledging their investment. Their cheque was deposited into the Horsham Finance Cheque Account on 29 February 2000. The sums of $10,000.00, $2,300.00 and $180.00 were then transferred the same day to the "L.R. Adams Trading As Insursmart" Account, which had a balance of $1,636.43 at that time. On 2 March 2000 two cheques were drawn on that account for the amounts of $13,811.09 and $302.41 made payable to CGU Insurance.
24 The Pekins received an interest payment each month for the first year of their investment, but payments became irregular in mid 2001. Pekin wrote to the respondent in October 2001 requesting the return of his investment. On 24 October he was advised to attend a meeting to discuss the financial affairs of Horsham Finance. He was told at that meeting that his investment meant that he was a stakeholder in the business. His principal has not been returned to him. He did not authorise the respondent to apply the sum he provided to him for any purpose other than the investment in "bridging finance" discussed in their initial meeting.
Counts 24 & 25
25 Mr Michael Peterson began working part-time for the respondent's business Horsham Finance in 1999. He became a full-time employee in January 2000 as a broker. On 12 August 1999 Peterson invested $10,000.00 with Horsham Finance on the basis that this sum would be used as bridging finance for purchasers of property, secured against second mortgages. On 22 May 2000 Peterson withdrew his investment. On 19 June 2000 he transferred $5,000.00 to Horsham Finance to be invested in keeping with his original investment. He received a Certificate of Investment and interest payments monthly. On 22 June 2000 Peterson's cheque was deposited into the Horsham Finance Trust Account together with the sum of $50.00. At the time of this deposit the balance of that account was nil. The funds deposited on this day were then dissipated by transferring $3,800.00 to E. Home Loans Horsham Account and paying $1,200.00 to E. Home Loan Pty Ltd Account.
26 In September 2001 Peterson requested the withdrawal of his $5,000.00 investment. He did this by sending an e-mail to the respondent. He did not receive a response and the principal has not been returned to him. He left the respondent's employ in November 2001. He did not authorise the respondent to spend his investment on items relating to the running of his businesses or on the respondent's personal expenses.
Counts 26, 27, 28, 29, 30, 32 and 33
27 Despite the fact that it was not an "eligible financial institution" for the purposes of holding Farm Management Deposits, Horsham Finance advertised as being capable of providing this product and offered interest rates competitive with the institutional lenders.
28 Mr Gary Terence Miller, having spoken to the respondent about investing $10,000.00 in such an account, completed what he believed were the necessary forms on 30 June 2000. The forms were headed "Horsham Finance" and were titled "Farm Management Deposits**"**. Mr Miller signed them believing them to be genuine and provided the respondent with a cheque for $10,000.00. The respondent told him that he would receive an interest payment after 12 months.
29 The cheque for $10,000.00 was deposited into the Horsham Finance Trust Account on 5 July 2000. On the same day $8,400.00 was transferred by cheque from the Horsham Finance Trust Account into E. Home Loans Account. The funds deposited into this account were then paid to Insursmart Trust Account ($2,519.00), Insursmart Trade Account ($1,968.71) and E. Home Loans ($2,000.00), leaving a balance in the original E. Home Loans Account of $1,370.59. On the same day, $688.24 was paid from the funds provided by Miller by cheque to Sandra Smith, another client of the respondent. This transaction was not authorised by Mr Miller and was conducted without his knowledge**.**
30 Mrs Vila Miller is the mother of Gary Miller. On 18 June 2001 Mrs Miller attended at the respondent's offices in Darlot Street Horsham and spoke to the respondent. The respondent arranged for her to complete forms on Horsham Finance letterhead, titled "Farm Management Deposit", despite the fact that Horsham Finance was not authorised to hold such deposits. Mrs Miller handed the respondent a cheque for $20,000.00, believing the representations made by the respondent about his capacity to provide the service he was purporting to provide. Moreover, Mrs Miller believed that she was investing in a government-protected fund and that her investment was guaranteed.
31 Mrs Miller's cheque was deposited into the Horsham Finance Trust Account on 18 June 2001. On 20 June 2001 $18,000.00 was transferred from the Horsham Finance Trust Account into E. Home Loans Account. On 20 June 2001 the proceeds of Mrs Miller's cheque were transferred into the E. Home Loans Account and from 20 June 2001 to 26 June 2001 the funds were dissipated through payments to a number of the respondent's clients for interest or other payments owing, to the respondent's family for personal and domestic expenses, and for sundry business expenses. Mrs Miller did not authorise any of these transactions and none of them benefited her. Her money was not invested by the respondent, contrary to his representations to her, and she has not recovered any of the capital sum she entrusted to the respondent.
32 In June 2001 Gary Miller deposited a further $17,500.00 into what the respondent represented to be a Farm Management Deposit Account held by Horsham Finance. Again, forms were produced with Horsham Finance letterhead purporting to be a "Farm Management Deposit" documents. Mr Miller completed the forms and signed them believing them to be authentic. He did so believing that his investment had government protection and was therefore insured. His cheque was deposited into Horsham Finance Trust Account on 29 June 2001. On 3 and 4 July 2001 a number of large transfers were made from the Horsham Finance Trust Account utilising the proceeds of Mr Miller's cheque, $10,000.00 being paid to E. Home Loans Account No. 79604201201 and interest and loan repayments to a number of the respondent's clients. The $10,000.00 part-proceeds of Mr Miller's cheque deposited into the E. Home Loans Account were used to make payments to the respondent's wife, payment of credit card debts, various domestic and personal expenses and payments of interest and other money owing to the respondent's clients.
33 Mr Miller did not authorise any of these transactions and none of them were conducted for his benefit. On or about 19 October 2001, Mr Miller was notified that the company was having financial difficulties. He has not recovered any of the principal paid to the respondent.
Counts 34, 35 and 36
34 On about 29 May 2001 Mr Lyall Hardy McClure and his wife consulted the respondent about depositing money into a Farm Management Deposit. McClure's daughter, Julie Nagorka, was present when the respondent visited McClure's farm to discuss the investment. McClure told the respondent that he was only interested in a Farm Management Deposit investment and proposed investing $50,000.00.
35 The respondent completed forms headed "Farm Management Deposit" and had McClure sign them, representing by his words and conduct that the forms were genuine when they were not. The respondent said that he was unable to complete the paperwork because he needed an "F.M.D. Number". He left, taking the paperwork with him. McClure handed him a cheque for $50,000.00 made payable to Horsham Finance. Mr McClure's cheque was deposited into Horsham Finance Trust Account on 30 May 2001. The following day $48,000.00 was transferred to E. Home Loans Account. Between 31 May and 4 June 2001 a series of internet transfers were made and cheques were written including $10,000.00 to E. Home Loans Visa Red Account; $5,092.00 to True Blue Dealers and a number of payments to the benefit of the respondent's wife. The remaining $2,000.00 was dissipated by way of a cheque and a series of internet transfers between 1 June and 15 June 2001. On 14 June 2001 a further $1,000.00 was drawn from the Horsham Finance Trust Account representing the dissipation of the balance of the amount invested by Mr McClure.
36 In late 2001 Mr McClure became aware that Horsham Finance was having financial difficulties. He spoke to the respondent who told him that he was under new management and could not comment. Mr McClure has not recovered the money he invested with the respondent. He did not authorise the respondent to deal with his funds in any manner other than to deposit them into a bona fide Farm Management Deposit account. This was not done on his behalf, contrary to the representations made to him by the respondent.
37 The respondent was interviewed by police on 2 September 2002, but declined to answer the questions put to him.
2nd Presentment
38 In respect of this presentment, the respondent was presented on 6 counts of theft. Counts 4 and 5 of this presentment related to the respondent's Car Club Investment scheme and counts 2 and 3 to his Overseas Money Market Investment scheme.
39 The Car Club Investment Scheme was conducted under the auspices of E. Car Loans, another of the services offered by the respondent as an adjunct to his E. Home Loans business. In March 2001 the respondent conducted a business seminar under the "E. Car Loans, Wizard" banner. Potential investors were told by the respondent that the scheme involved leasing a vehicle whereby the purchaser would borrow money for the lease, 18% of which would be applied to a "car club" investment which in turn would generate returns sufficient to cover the lease repayments on the car, such returns to be paid annually. The respondent told potential investors in the scheme that the money was capital guaranteed and that the money invested would be spread amongst a variety of funds to minimise risk. Counts 4 - 6 inclusive relate to the operation of this scheme.
40 The Overseas Money Market Investment Scheme relates to a series of meetings conducted by the respondent with potential investors whereby he persuaded a group of "A List" investors to provide him with substantial sums of money which he undertook to place in the overseas money market on the understanding that the money invested would generate returns far greater than those advertised by local lending institutions.
Count 1
41 In early 2001, the respondent introduced Mr Dino Macchia to Mr Ross Morrison, having told Macchia that Mr Morrison intended to establish a bank in Australia. The respondent further told Macchia that he, the respondent, intended to invest with Mr Morrison, that the investment was a good one and that the minimum required for the investment was $20,000.00. The respondent represented to Macchia that this investment would produce a return of 10% per month. Mr Macchia told the respondent that he could only afford to invest $10,000.00. On 8 May 2001 Mr Macchia wrote a cheque for $10,000.00 which were deposited into the Jolithea Family Trust Account, an account operated by the respondent. On 17 May 2001 two amounts of $4,000.00 and $5,000.00 were transferred to E. Home Loans Account and $1,000.00 transferred to E. Home Loans Visa Red Account
42 On the same date the funds deposited in the E Home Loans Account were dissipated by a series of internet transfers being payments made either to other clients of the respondent or the payment of bills owing by the respondent.
43 Mr Macchia did not authorise the respondent to deal with the funds he entrusted to him in any fashion other than in pursuit of the investments the respondent had represented to him. The $10,000.00 referred to above was provided to the respondent to deposit into the new bank which the respondent said was being established by Morrison. Mr Macchia received no return on his investment and the principal has not been returned to him. Morrison did not tell the respondent that he was setting up a bank and did not receive any money from E Home Loans or from the respondent.
Count 2
44 On 1 February 2001, Mr Shane Alfred Lavell transferred $45,000.00 into the Jolithea Family Trust Cheque Account at the request of the respondent. This transfer was made as a consequence of representations made by the respondent to Lavell inducing him to invest in a high-yield overseas investment scheme. The respondent told Lavell that this scheme had the potential to earn up to 100% per annum and that the principal would be guaranteed. The investment was to be for a period of 12 months with dividends payable monthly. At the end of the 12 months Lavell was to have the option of reinvesting or opting out of the scheme. He did not receive any documentation from the respondent certifying his "investment". In early February 2001, $34,500 was transferred from the Jolithea Family Trust Cheque Account to E. Home Loans Account. The credit balance created by these deposits was then dissipated by a series of internet transfers, personal bill payments and cash cheques. A further sum of $10,013.47 was transferred from the Jolithea account to Baruch Investments, Vanuatu.
45 Throughout the period of this investment Lavell enquired about its performance. At one stage the respondent told him that he was having cash-flow problems. The respondent asked Lavell for $30,000.00. Lavell gave him $10,000.00 on 13 August 2001 to enable the respondent to pay wages. On 24 October 2001 Mr Lavell attended a meeting convened to discuss the financial problems confronting the respondent's businesses. Shortly before Christmas 2001 Lavell asked the respondent about the performance of his overseas investment. The respondent told him that it had not started to make a return at that stage. The respondent told him that the money had been invested, but could not say where or with whom. Lavell requested bank statements to verify the deposit. The respondent told him that the bank would not provide the statements until a credit card debt was settled.
Count 3
46 On 18 April 2001 John Terence Trollope met with the respondent to discuss investing $20,000.00. The respondent told him that his money would be invested overseas and would generate a return of 30% per annum. On the strength of these representations Trollope went to the National Australia Bank with the respondent and deposited $20,000.00 into a trust account held by the respondent.
47 On 18 April 2001 a cheque for $20,000.00 was deposited into the Jolithea Family Trust Account. The proceeds of that cheque were then transferred on 21 April 2001 into the E. Home Loans Account. The proceeds of that deposit were then dissipated by a series of internet transfers and bill payments, being payments made to other clients of the respondent or payments of bills owed by the respondent including $2,500.00 toward the respondent's residential mortgage.
Count 4
48 On about 3 March 2001 Margaret Evelyn Simonds and her husband attended the office of E. Home Loans to discuss the purchase of a new car. There they discussed the workings of the Car Club Scheme with an employee of the respondent, Martin Smith. As a result of Smith's representations, a loan for $16,585.00 was brokered by E. Car Loans. Macquarie Leasing Pty Ltd was the lender. Simonds signed a contract for the purchase of the car on 5 March 2001 and received the car a few days later.
49 On 21 March 2001 Simonds paid $2,520.00 to E. Car Loans by cheque representing her investment of 18% in the car club. That cheque was deposited into the E. Home Loans Account on the same day. The proceeds of this cheque were then dissipated in a series of withdrawals, cheques and transfers. The sum provided by Simonds was entrusted to the respondent's business for the sole purpose of investing in the respondent's Car Club Scheme. It was not so invested and Simonds received no benefit from its deposit into the respondent's E. Home Loans Account.
Count 5
50 In March 2001 Mr Tim Paul Butler attended a business seminar run by the respondent under the "E. Car Loans, Wizard" banner wherein the respondent discussed the Car Club Investment scheme. Approximately one month later Martin Smith, the respondent's employee, visited Butler's workplace and provided him with documents relating to the lease of a car. The value of the lease was $24,000.00, 18% of which came to $3,870.00. This sum was to be invested overseas in the short-term money market according to the terms of the scheme and the revenue generated by this investment was to cover the lease repayments.
51 On 18 June 2001 Butler wrote out a cheque for $3,870.00 made payable to E. Home Loans. He gave the cheque to Smith. That cheque was deposited into the E. Home Loans Account on 26 June 2001. Between 26 and 28 June 2001 the proceeds of this account were transferred to other clients of the respondent.
52 In November 2001 Butler spoke to the respondent and asked for paperwork to verify his investment. The respondent attended at Butler's workplace in December 2001 and told him that the money was tied up in the World Trade Centre, but because of the 11 September attack he was having trouble confirming the details. In 2002 Butler telephoned the respondent. The respondent told him that the E. Car Loans Head Office did not have details of Butler's loan. In a subsequent phone call the respondent told Butler that E. Car Loans no longer existed, but that his investment was safe. Butler has received no payments from the scheme and the money he invested has neither been returned to him or accounted for.
Count 6
53 In 1999 Ms Sandra Catherine Smith consulted the respondent for financial advice. As a consequence, she restructured her home loan, borrowed an additional $6,000.00 and arranged for her wages to be paid to her loan account.
54 Approximately 8 months later the respondent advised Smith to withdraw $3,000.00 and invest it with Horsham Finance, one of the businesses operated and controlled by the respondent. About 12 months later Smith invested a further $500 with the original investment.
55 Early in 2001 Smith wrote to the respondent requesting the return of her money. Each time she contacted the respondent he told her that she would have to wait. Despite repeated requests the amount of $3,500.00 has not been returned to Smith and the respondent has failed to account for it.