Gold Coast property scheme promoter sentenced to 8.5 years in jail: How to spot big company fraud

Former shadow director of Capital Growth International Club and All About Property Developments Tony Silver has been sentenced to eight and a half years imprisonment for fraud totalling $1.815 million.

Following an Australian Securities and Investments Commission (ASIC) investigation, Mr Silver pleaded guilty to misappropriating the funds between April 2009 and June 2010 from the two scheme companies.

Mr Silver led all decisions made over the cash invested in the companies, which added up to $9 million from investors between 2008 and 2010 — many of whom were pensioners.

Mr Silver pleaded guilty to transferring big chunks of this money into his personal accounts, making payments to company employees and paying returns to other investors.

In delivering the sentence, Judge Vicki Loury KC remarked on the “significant” impact of Mr Silver’s fraud on the victims and the financial and psychological cost they endured.

Many of the scheme companies’ investors were approached via telemarketing, cold calls, or word of mouth. They were promised big rewards if they handed their hard-earned cash over to Mr Silver.

And this is not an uncommon occurrence. Just this week, the Australian Competition and Consumer Commission revealed that scammers, hackers and fraudsters stole $3.1 billion from Australians in 2022.

So how can investors ensure they don’t fall victim to these traps?

“If it sounds too good to be true … it probably is”

ASIC Moneysmart spokesperson Andrew Dadswell said investors must be wary of any company that contacts its investors to offer loans or opportunities via telephone.

“Do your own checks on any opportunity to make sure it’s real,” Mr Dadswell said.

“Be wary if a company contacts you to offer an investment opportunity out of the blue; don’t just rely on the information they give you to make an investment decision.

“Information should never be solely trusted without being verified by an independent source first, and if it sounds too good to be true, most of the time it probably is.”

In Mr Silver’s case, investors were told that their funds would be used to develop property in Tasmania or be pooled and invested in bank term deposits with investment returns of up to 15-20 per cent.

Some investors were even convinced to borrow against their homes to invest with the scheme companies.

The matter was prosecuted by the Commonwealth Director of Public Prosecutions after receiving a referral of evidence from ASIC, which set Mr Silver a non-parole period of two and a half years.

According to ASIC’s Moneysmart website, investors must be mindful of warning signs before investing in any company and also keep an eye out for signs that their investment may be in the hands of a fraudulent business.

A clear warning sign can often be if a company continues to raise funds but never clearly states where these funds are going. A lack of exploration, research and development, or business operation updates from a company can be a sign the invested funds aren’t being used honestly.

The taking on of loans, asset sales or purchase agreements with related parties where there is no clear business purpose is another tactic used by fraudulent company owners.

“If you’re looking to invest in a company, make sure you do your research. Read the prospectus carefully, especially if they’re issuing new shares on the market,” Mr Dadswell said.

ASIC’s Moneysmart also provides Australians with a list of companies to avoid who have made unsolicited calls and emails about financial services or products and who did not hold a current Australian financial services (AFS) licence or Australian credit licence from ASIC.

This list can be accessed from the Moneysmart website.

Article source: themarketherald.com.au

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