Notorious spruiker in ASIC’s sights again
ASIC has brought legal proceedings against a notorious property spruiker and their associated companies, resulting in more than 100 investors being left in limbo having been exposed to schemes that may be operating outside of the law.
The Australian Securities and Investments Commission (ASIC) has started proceedings in the Federal Court of Australia against companies associated with property spruiker Jamie McIntyre and the 21st Century Group, regarding their promotion of five ‘land-banking’ schemes.
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The regulator has alleged that the schemes are unregistered managed investment schemes and that the 21st Century Group and Mr McIntyre have been unlawfully carrying on an unlicensed financial services business.
The regulator believes there are more than 100 investors in the schemes, which have been promoted to investors by entities associated with Mr McIntyre's 21st Century Group.
It's not yet clear what will happen to these investors or any funds they have invested in the schemes.
“ASIC is seeking orders to appoint a provisional liquidator or receiver and manager to each of the five schemes and the development companies in order to take control of any assets and protect the interests of investors,” it said.
Mr McIntyre and his brother, Dennis McIntyre, this week undertook to notify ASIC of any travel outside of Australia and to deliver their passports to their solicitors.
The matter has been set down for a hearing on 8 October 2015.
This is not the first time that Jamie McIntyre or one of his associated companies have had a run-in with ASIC, with the regulator first launching legal action in 2002 over alleged breaches to the Corporations Act.
That matter was finalised in 2007, with ASIC agreeing to discontinue proceedings.
Land banking is a property investment scheme in which a promoter acquires large blocks of land – often in undeveloped rural areas – and then offers portions to investors.
Promoters typically emphasise the high potential returns available if the land is redeveloped or if plans for rezoning and development are finalised.
ASIC named the five schemes in question as:
• Botanica, located at 805 Archer Rd, Kialla, Victoria 3631
• Secret Valley Estate, located at 955, Old Sydney Road, Bylands, Victoria 3762
• Oak Valley Lakes Estate & Resort, located at 124 Booth Road, Brookhill, Townsville, Queensland 4816
• Bendigo Vineyard Estate & Resort, located at 51 Andrews Road, Bendigo, Victoria 3551
• Melbourne Grove Estate, located at 1491 Dohertys Road, Mount Cottrell, Victoria 3024
ASIC said that while it does not regulate direct property investment, some land-banking schemes may be a managed investment scheme or a financial product. As a result, the promoters would need a financial services licence and to register the schemes with ASIC.
“ASIC is also seeking orders that each of the defendants, including Mr McIntyre, be restrained from promoting, further promoting or operating any of the schemes and from operating a financial services business,” it said.
Smart Property Investment contacted Jamie McIntyre via email, seeking comment for this article. He had not made contact at the time of publishing, but he has previously called for a Royal Commission into ASIC’s conduct via his website, Response to ASIC Allegations.
Mr McIntyre rebuked the regulator’s latest move this week in an article published in the Australian National Review, run by the publishing division of his company 21st Century Media.
Mr McIntyre stated that “ASIC is trying to suggest ‘property options’, which are legal instruments and a legitimate way for investors to acquire land, are actually ‘financial products’ … Others, including myself would like to know when that law was changed, or is ASIC now inventing new property laws in its spare time?
“If ASIC can’t handle criticism and wants to try and destroy me, then bring it on. I am not easily intimidated by shonky ASIC employees, but at least leave the innocent investors out of it,” he went on to say.
ASIC’s proceedings are part of a wider and ongoing investigation into land-banking schemes.
The regulator last week settled proceedings against Midland HWY, which was the developer of a land banking scheme that was also promoted by the 21st Century Group.
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