ASIC Investigation ongoing against Mayfair 101 director James Mawhinney
ASIC has obtained interim orders in the Federal Court of Australia against companies in the Mayfair 101 group and their director, James Peter Mawhinney, including the appointment of provisional liquidators to M101 Nominees Pty Ltd, the issuer of the M Core Fixed Income Notes promoted by Mayfair 101.
On 13 August 2020, the Court appointed Said Jahani and Philip Campbell-Wilson of Grant Thornton as provisional liquidators of M101 Nominees, pending an application by ASIC to wind up M101 Nominees on just and equitable grounds. ASIC alleges that M101 Nominees has been involved in breaches of the corporations legislation, and there is a justifiable lack of confidence in the conduct and management of its affairs that gives rise to a risk to the public that warrants protection.
In particular, ASIC alleges that M101 Nominees raised approximately $67 million from investors through debentures called the M Core Fixed Income Notes, based on representations that there would be security for the full amount invested. ASIC further alleges that those funds were not fully secured, and consequently, M Core Fixed Income Note investors may be unable to recover the full amount of their principal investment.
The provisional liquidators will provide a report to the Court by 24 September 2020 about the provisional liquidation of M101 Nominees, including identifying its assets and their value, and providing an opinion as to solvency and the likely return to creditors if the company is wound up.
On 13 August 2020, the Court made additional interim orders restraining Mr Mawhinney, and any company of which he is an officer or shareholder, from:
Receiving or soliciting funds in connection with any financial product;
Advertising or promoting any financial product; and
Removing from Australia any assets acquired with funds received in connection with any financial product.
These orders apply to all products currently offered by Mayfair 101, including the M Core Fixed Income Notes, the M+ Fixed Income Notes and Australian Property Bonds, as well as any other financial product.
The Court also restrained Mr Mawhinney from leaving Australia until further order.
The Court made interim orders restraining Sunseeker Holdings Pty Ltd, of which Mr Mawhinney is a director, from dealing with the units in 14 trusts which hold property at Mission Beach and Dunk Island in Queensland. The units in those trusts are part of the security held on behalf of investors in the M Core Fixed Income Notes.
ASIC’s investigation is ongoing.
