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Equititrust?

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Will be interesting to see what moral backbone the national partnership of Worrells have in how they deal with Peldan and Cook...

To be involved in this scheme is reprehensible...

They also need to answer to the Supreme Court of Queensland...
 
Always good to go back a few steps sometimes...

6. Federal Court Examinations
I refer to the comments from my previous report dated 1 February 2017.
On 22 February 2017, our solicitors, Russells Law, appeared on behalf of the Liquidators in the Federal Court of Australia at Brisbane and secured the production of numerous documents from the following persons:
• Mr Paul Vincent, former director of the Company; • Mr Russell McCart, a former guarantor of the debts owed to the Company (as trustee of the EPF) by the Meridien Group; • Mr Jim Conomos, a solicitor who represented Mr McCart and his co-guarantors, Messrs Paul Barrett and David Roberts, in litigation brought against them by the Company, and continued by receivers appointed by MS Asia Debt Acquisition Limited (Messrs Pelden and Cook of Worrells) represented by Tucker & Cowen solicitors; • Messrs Pelden and Cook, the receivers appointed by MS Asia; and • Mr Luke McKenzie, an executive of Balmain NB Commercial Mortgages Limited ("Balmain"). For convenience, Mr McKenzie also produced, in Brisbane, documents which had been required from Balmain itself.

Our solicitors secured access to and copies of all such documents. However, MS Asia has made a claim for legal professional privilege in respect of some documents produced by its receivers.
That claim remains to be determined.

In order for the Liquidators and our legal advisors to have time to consider these documents, the examination of all examinees was adjourned until 5 April 2017 in Brisbane.
Our solicitors appeared in the Federal Court of Australia at Sydney on 8 March 2017 and secured production of documents from the following persons:
• Commonwealth Bank of Australia ("CBA"); • AET SPV Management Pty Ltd as trustee of the Lawson Trust (the entity which sold the EPF loan portfolio to MS Asia); • Balmain (further documents having come to light since its production of documents in Brisbane); and • Morgan Stanley Australia Limited and Mr Shane Beecroft.

http://www.equititrust.com.au/Pdfs/Liquidator/Liquidators Reports - 20170403 - Circular to Creditors.pdf
 
2.3 Sophisticated Fund

"however a meeting was held on the 5th of June 2013 (without my knowledge) between the representatives of the Court Appointed Receiver, The Receivers and Managers of the EPF and the borrower."

So translating this, the liquidator was kept out of the loop whilst Tucker and Kennedy stooges Worrells dealt directly with Whyte and the borrower...

Well no wonder the meeting occurred without the Liquidator's knowledge...

This little gem needs to see the light at the Public Examination.


http://www.hallchadwick.com.au/Equititrust Ltd - Circular to Creditors - 22.08.2013.pdf
 
Now, did Worrells advise Whyte that Tucker, a lawyer who was doing work for the EIF was a beneficial owner of MS Asia ???

So Tucker was doing legal work for Whyte on the EIF and in turn had a beneficial interest in the EPF assets where priority deeds and subsequently eventual returns to the EIF were being negotiated.

If this isn't the biggest conflict of interest I have ever seen in my life, then I don't know what is...

What has David Whyte have to say about this...


(ii) Rosea
(Wongawallan, QLD)
As advised in previous reports, the Rosea loan is subject to a deed of setttement, which was scheduted to settte on 17 June 201 3. As the debtor was unabte to settte, a proposal was received whereby the debtor is undertaking a sate campaign with respect to the property in Wongawallan, QLD with expressions of interest ctosing on 3 October 2013 with further payments proposed over a 12 month period.

(iii)
Gold Coast, QLD
As advised in previous reports, this property is subject to possession proceedings and where mediation took ptace on 11 September 2013. An agreement was reached to obtain possession of the property, however, this is subject to the Equititrust Premium Fund (Receivers and Managers Appointed) ('EPF') also agreeing to provide a release of its claims.

A response is currently awaited from the EPF in this regard. Shoutd the EPF not agree, the matter will proceed to trial.

http://www.equititrust.com.au/Pdfs/Receiver/Receivers Reports - 20130919 - 14th Report to Investors.pdf
 
To add further insult to injury Tucker's superfund was an investor. This in itself created an untenable conflict of interest. Tucker had a bet each way, if he influenced decisions as to priority via Worrells in favour of the EPF or as a lawyer for the EIF in favour of the EIF he received a benefit on top of being paid legal fees by Whyte. Am I wrong ? Me thinks not and neither does the liquidator.

This is was a F#CKING aberration on any ethical duty owed to both the investors of EIF and the EPF...
 
How can people connected to this scam be allowed to practice and maintain their licenses...
 
The multiple breaches of both fiduciary and statutory duties by those involved is jaw dropping.

Once this litigation commences and most likely before, heads will roll.

Given the post GFC spotlight on greed and malfeasance in the financial sector, it's seems nothing was learnt and the pigs put their heads back into the trough at the expense of innocent retiree investors.

If ASIC does not make examples of those involved here, then ASIC and the system has failed.

ASIC is aware of what's occurred, now let's see how they respond...
 
How on earth did Dumb and Dumber think that this would not be exposed.

How did firms like Worrells and BDO let this happen ?
 
As bad as McIvor is and he is a miscreant as proven by the civil and criminal courts. It appears that Tucker and Kennedy were hellbent on destroying him personally to get to the loot.

Having given Kennedy a job and Tucker millions in legal fees Tucker and Cowan personally bankrupted him for a personal debt of approx 20 odd thousand.

Talk about kicking a mate when he's down...

As I said I'm no fan of McIvor and never will be but as an observer one has to highlight the obvious.

In the past I have been highly critical of the Liquidator and I stand by most of my criticisms, however I can now see another side to the partisan way that BDO were conducting the EIF receivership in partnership with both Tucker and Kennedy to the extent that the liquidator was excluded from meetings as mentioned in my post above.

The manner in which the liquidator and law firm Russell's has undertaken the current proceedings deserves high commendation and the investors of the EPF and EIF should support their actions.

Given what may be unearthed the EIF investors may be owed a clawback on fees and possible a claim on the professional negligence insurance of BDO as the insolvency may not have been undertaken on an arms length basis.

BDO's payments need to be blocked until forthright answers are given regarding the relationships with Tucker, Kennedy, Worrells, Cook and Peldan....
 
Not so Cryptic

Highlights lead to a bigger picture

Equititrust house of cards tumbles down
Anthony Marx, Courier Mail
October 23, 2011


THE email landed like a hand grenade in a living room.
"To not accept my advice is senseless. You will exponentially increase your liability to me," Mark McIvor wrote on September 28 to all but one of the directors of his beleaguered Gold Coast funds management firm Equititrust court documents allege.

The court documents claim board members were stunned by the threat. It prompted McIvor's long-time friend, David Jackson QC, to resign as a director and then-chief executive David Kennedy to respond by email that day.

According to the court documents Kennedy told McIvor that he was responsible for much of the company's problems and had now lost the support of everybody inside the organisation. McIvor's recent stress-induced behaviour was "irrational, ill-conceived, self destructive and dangerous", the email said.

McIvor, who launched the company in 1993 and remains the sole shareholder, had stepped down three months earlier from the board.

He still wanted to find new strategic partners and real estate opportunities to resurrect and restructure the firm's moribund $159 million Income Fund, which has been frozen since October 2008 and stopped paying distributions in April, according to the documents. McIvor even talked about launching new investment vehicles.

But, the documents state that with the fund suffering massive losses because of bad loans, the board remained focused on winding it down, selling assets and returning money to mostly elderly investors who had made it clear they wanted to get their cash back. A $66 million Premium Fund is also shutting down.

The emails are included in a Supreme Court application filed last week by former board member David Tucker, who wants an outside expert - insolvency practitioner David Clout - to preside over the funds' orderly dismantling.

Tucker alleges McIvor is desperate to recover personal losses in the Income Fund through a series of new deals and is not "a fit and proper person" to oversee the windups.

The court documents, including Tucker's 44-page affidavit provides a rare glimpse inside an apparently dysfunctional company at war with itself. It chronicles in painful detail the unraveling of the working relationship between McIvor and his chief executive and board as the corporate climate grows increasingly poisonous.

"McIvor seemed to lose interest in the board resolutions, namely to recover loans and pay money back to investors, but rather seemed to become more and more focused on his new strategy and vision," Tucker alleges.

The sworn statement alleges it was only in August that Kennedy discovered Equititrust and McIvor's personal company, MM Holdings, had borrowed up to $24 million from Westpac. The loan had never been disclosed to the board and Equititrust derived no benefit from it, according to Tucker's affidavit.

"Similarly, McIvor is substantially indebted to the NAB for approximately $11 million. I know this because NAB is the financier to EIF (Equititrust Income Fund) and McIvor's personal debt had been openly discussed in meetings with NAB which I have attended," the affidavit says.

McIvor also promoted the repayment of $2.6 million to his superannuation fund ahead of the company's NAB debt, it is alleged.

Later, Tucker claims in his affidavit, McIvor proposed releasing the three directors of embattled development firm Meridien from guarantees in relation to a $12 million loan made by the Premium Fund. In a September 9 email, it is alleged, McIvor said he wanted to secure the skills of Meridien director Russell McCart to manage assets in the deeply-troubled Income Fund.

But, as Tucker noted, in his affidavit, Equititrust had launched legal proceedings against McCart and two other Meridien directors just two days earlier to recover the loan and to enforce caveats over their family homes. (Beneficiary of this legal work was a Tucker who was also a director of the company. He had a vested interest in the legal proceedings remaining on foot) (Then as a beneficial owner of the EPF Assets he had a vested interest in the sale of these peoples homes)

"I considered it wholly inappropriate that McCart, who owed the EPF (Equititrust Premium Fund) $12 million, be put in charge of assets of either fund," Tucker allegedly wrote.
(Note : Tucker and Kennedy then put themselves in charge of the assets of the EPF via their hidden ownership of MS Asia...)
"McIvor also said that the board agreed that he resigned to lead the new property manager with Russell McCart - this was just false. The board resolved no such thing, nor would it ever."

Undeterred, McIvor briefly started working in the office again last month but "that did not go well, as McIvor immediately ignored Kennedy's instructions, as Kennedy later reported to the board", the affidavit says. It is claimed McIvor then notified the board that he was working on a potential refinance deal, wanted to launch an "angel fund" to accelerate the departure of NAB and planned to sell his shares in Equititrust.



"By now, it was apparent to me from prior dealings and communications, that McIvor was not capable of exercising good judgment as to what was in the best interests of investors, that he lacked, or misunderstood, good corporate governance, and that he was more interested in seeking to restore his own lost subordinated investments, and prefer his own interests," Tucker alleges.

In a blunt response to McIvor about his plans, Tucker allegedly provided advice that was, as he described it, "without pleasantry or platitude".

"You have made some bad loans. Those loans have been mismanaged on your watch. You should walk away from Equititrust - it is, as the board has resolved, all about collecting the loans for the investors and returning investor money. That is what the investors now expect," Tucker's email alleges.

By this point, the relationship between the two men had become "strained" and McIvor ousted Tucker on October 12.

McIvor did not return calls seeking comment last week.

Originally published as Equititrust house of cards tumbles down


http://www.couriermail.com.au/ipad/...d7aa64c99?sv=1cefd2ea9b6101ac0a852ae21c562c96
 
In that letter, Mr Russell described why the Liquidators were seeking to examine him about the affairs of Equititrust, in the following terms:

To put the matter in context, the liquidators are seeking to examine you about your role and that of Mr David Kennedy in gaining what appears to be a very substantial profit, derived from an apparently serious breach of your and his fiduciary and statutory duties. The gross receipts of your scheme are, as you know, at least $17 million. With interest, the claim under investigation exceeds $20 million. The beneficiaries of this claim are the unit holders in the Equititrust Premium Fund.

…

The evidence gathered to date shows that you procured Tuckerloan Pty Ltd to pay one third of the purchase price of $2 million and that Mr Kennedy paid the balance. You and Mr Kennedy set up MS Asia as a nominee Hong Kong company apparently to conceal your and his involvement.

http://www.judgments.fedcourt.gov.au/judgments/Judgments/fca/single/2017/2017fca0758
 
What this case will highlight when exposed nationally by the media, is that lawyers and insolvency practitioners cannot use insolvencies as their own personal slush funds...

Once approved or appointed by a court, there is no real oversight... The Equititrust saga involving BDO, Whyte, Worrells, Peldan and Cook as well as Tucker and Kennedy shows what happens when you give financial vampires the keys to the proverbial blood bank...
 
Some surprises on the cards in the next few weeks I'm reliably informed...
 
Ongoing proceedings tend to increase Professional Indemnity Insurance exponentially...
 
Camera's, still and video outside Federal Courts tend to capture the moment for posterity...
Smile... :)
 
And the award for Public Examination / Humiliation of the year goes to...........................................
 
Should the investors of the EPF get a vote on the performance of Tucker / Kennedy / Worrells / Peldan / Cook ???
 
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