Fraud

<html><body>
Peter Brian Cockroft, 65, plead guilty to fraud in circumstances of aggravation after he mortgaged the home of his 92 year old father, who had been hospitalised with dementia.
The Courier Mail reports that Cockroft mortgaged his father’s home for $565,000 in December 2009. Cockcroft, who wrongly obtained his father’s signature, did not first gain approval from his father’s trustee before he mortgaged the house.
The former company director and financial worker used $540,000 of the money he obtained to invest in the now collapsed Capital Growth International Club.
According to The Courier Mail, Cockroft told authorities that the money was intended to pay for renovations to his father’s home. However the court heard that it was at the time “highly improbable” that the elderly Keith Cockroft would ever return home, given his condition. He passed away at the age of 94 in 2011.
Judge Brendan Butler QC stated that Peter Brian Cockroft “took advantage of an aged person lacking capacity to make his own financial decisions.”
This is not Cockroft’s first jail sentence. He was jailed for two months in 1997 after allegedly misappropriating $75,000.
</body></html>

jrichardson-uRX5hFdKfN

Brisbane man jailed for three years after mortgaging sick dad’s home

<html><body>
Cyber fraudsters are believed to be behind a total of $50,000, made in three payments, out of a Broome real estate agency's trust account. It is believed the criminals accessed the agency's online banking system after a compromised email saw malware installed.
One of the recipients receiving regular payments had their account details altered on a pre-entered list, seeing their $50,000 redirected to another's account. Then, the details were changed back to the original to avoid detection of the fraud.
The agency has been reimbursed by their bank since the incidents in February.
In March last year, another agency experienced a similar case of cyber fraud, seeing $50,000 stolen through two BPay transactions from a trust account. The bank detected these cases early, and recovered the funds.
As a result, Commissioner for Consumer Protection Anne Driscoll has put out a warning to real estate agents, and settlement agents, to be wary of fraud. She also suggests that strict security protocols are in place for computer usage.
“While the property industry has been targeted in these cases, fraud of this kind can affect any business so it’s essential that businesses have procedures and protocols in place to prevent unauthorised access to their computer system and systems to detect malware,” Driscoll said.
“Staff should be trained to ensure that suspicious emails are deleted immediately, attachments are never opened and links never activated. Having up-to-date anti-virus and anti-malware software is essential for any business."
She suggested that agents manually input bank account details of clients when making electronic bank payments, rather than using pre-entered lists.
These are not the only type of cyber scams around - in 2012, <a href="https://www.urban.com.au/expert-insights/investing/16841-vigilant-applecross-perth-estate-agency-prevents-another-fraudulent-house-sale-nigerian-scam" target="_blank">a vigilant Applecross, Perth agency managed to avoid being victim to cyber crime</a>.
CONSUMER PROTECTION'S ANTI-FRAUD ADVICE:
<ol>
<li>Have the latest security software (anti-virus, anti-spyware, firewall) installed on computer systems and keep the operating system up-to-date. 
</li>
<li>Remind staff of basic electronic security measures. If suspicious emails contain an attachment, do not open them as they may contain malicious software (malware or spyware). Do not click on any links within these emails and delete them immediately. 
</li>
<li>Be wary of unsolicited emails purporting to be from your bank as these may be phishing scams. 
</li>
<li>Be aware that banks will never ask you to supply any of your details via email. 
</li>
<li>Consider using security tokens or set up a mobile phone security code protocol when using e-banking and verifying all payments. Ensure the device protocols are set to the highest possible level for all staff members. 
</li>
<li>Revise transaction limits and reduce them if they are too high. Sometimes it’s safer to make smaller multiple payments than allow for one large payment to be made from your bank account. 
</li>
<li>Tyoe the address into the address bar when accessing online banking. Never click on an online link or ‘favourites link’ to access your bank’s webpage as these can be manipulated to send you to a counterfeit site. While these sites may look similar to your bank’s webpage, fraudsters operate them to obtain your personal banking details and passwords. 
</li>
<li>Staff members should enter a payee’s bank account details manually whenever they make an electronic funds transfer.</li>
</ol>
Property Observer suggests that investors should ask their agents how they protect themselves, and their clients' information.
</body></html>

jduke-EHk3XBmHkn

Cyber criminals steal $50,000 from Broome real estate agency trust accounts

<html><body>
Victorian broker Kieu Thi-Thanh Huynh, of Sunshine, has been sentenced to four years in prison, with a minimum of two years served before she becomes eligible for parole after being convicted of serious fraud offences.
Huynh has also been permanently banned by ASIC from engaging in credit activities and has been disqualified from managing a corporation for five years.
In February this year she pleaded guilty in the Supreme Court of Victoria on 27 charges of obtaining more than $9.4 million of property by deception. She was also charged with one attempt to obtain property by deception.
As the former sole director of St Andrews Mortgage Solutions Pty Ltd (SAMS), she was authorised between July 2010 and March 2013 for a number of Australian Credit Licensees.
The charges related to her involvement in creating false payslips to provide to various credit providers, supporting loan applications which she submitted on behalf of her clients. 27 loan applications totalling $9,411,688.30 were successful.
Huyhn's upfront commissions were $41,231.14, with trailing commissions of $14,510.85, a total of $55,741.99. She also received cash payments of $10,000 in relation to the false payslip scheme.
Huhyn has the right to appeal.
</body></html>

Victorian broker jailed and permanently banned from credit activities after serious fraud conviction

<html><body>
A Melbourne-based accountant has been sentenced to three years in prison for <a href="https://www.smartcompany.com.au/legal/32929-accountant-who-blamed--2-4-million-tax-fraud-on-autism-sentenced-to-four-years-in-jail" target="_blank">fraud</a> after dodging almost $8 million in tax in 2005.
Stephen Lynne Wharton has been found guilty by the Supreme Court of Western Australia of filing three false tax returns to the Australian Tax Office in 2005, while he was in prison for other fraud-related offences.
The fraud was uncovered by the Australian Crime Commission during an investigation of tax schemes used by wealthy businessman and entertainment figures, according to<a href="https://www.theage.com.au/national/toorak-accountant-stephen-lynne-wharton-jailed-for-tax-fraud-20140413-36let" target="_blank">The Age</a>.
The incorrect tax returns understated income earnt by Wharton’s trust accounts between 2002 and 2004.
The investigation by the ACC was part of Operation Haycastle, which saw tax schemer Gregory Dunn sentenced in February to seven years in prison.
Wharton is said to have operated as the middle man in the scheme, concealing money on behalf of Dunn in different trust accounts. Dunn then paid Wharton an 8% commission in return.
Dunn had passed Wharton more than $12 million from two of his clients in the 2002 tax year.
Warfield and Associates chief executive Brett Warfield told SmartCompany creating fraudulent tax returns is a reasonably common tax scheme.
“This has happened numerous times before where tax accountants have submitted false returns without the knowledge of their clients and then gained the profits, although this one seems to have occurred with the knowledge of the clients,” he says.
“There are two ways false returns can work, either misrepresenting the income of a trust or it would overstate the expenses. Either way, you don’t pay as much to the ATO.”
Warfield says these schemes are usually created out of greed.
“The majority of these schemes I’ve seen have been conducted by individuals, but the biggest schemes can’t be done on an individual basis, so always require collusion,” he says.
“This is a guy who has been in trouble, gone to jail and continued to be involved in schemes while in jail. He’s certainly not someone who has learnt his lessons”.
In July 2004 Wharton was jailed for five years, with a conditional release after 18 months, for attempting tax fraud of $26 million in conjunction with Perth-based accountants Walter Tieleman and Sean Pearce.
The men had promoted a tax minimisation scheme in 1998 which offered large tax deductions to miners with high incomes.
At the time Judge John McKechnie described Wharton as “a man of straw” and a “financial rogue”.
Warfield says the ATO doesn’t generally “go digging” into the activities of a specific accountant, unless it receives a tip off or discover inaccuracies as part of a broader investigation.
“In order to commence a large scale investigation they tend to need to uncover a goldmine of information,” he says.
“The ATO rely on the honesty and integrity of both lawyers and accountants, and when this is breached it can have a significant impact on the country’s financial system.”
This article first appeared on <a href="https://www.smartcompany.com.au/" target="_blank">SmartCompany</a>.
</body></html>

yredrup-o4Anfe78KF

Melbourne accountant jailed for three years after orchestrating $8 million tax fraud from prison

<html><body>
A Melbourne man who claimed to be a financial planner faced the Magistrates’ Court this week, charged over his involvement in a <a href="https://www.smartcompany.com.au/legal/42108-business-group-swindled-out-of-800-000-through-fraud" target="_blank">fraud</a> scheme said to be worth $100 million over 10 years.
<a href="https://www.theage.com.au/victoria/poker-pro-faces-142-charges-over-100m-fraud-20140528-394ev" target="_blank">Fairfax reports</a> Bill Jordanou, 55, faces 142 charges relating to 40 incidents between 2004 and 2013, including more than 100 charges of “obtaining a financial advantage”, often in the form of home loans and electronic transfers into home loan accounts.
Jordanou is also facing charges related to obtaining property by deception, conspiring to defraud the Commonwealth Bank, ANZ Bank, Bankwest, Bank of Melbourne and Bank of Queensland, conspiring to pervert the course of justice, and the theft of a Mercedes-Benz.
Prosecutor Luke Excell told Fairfax Jordanou is “alleged to have drawn funds using false client approvals and invoices … then used it across various property developments as well as maintaining a lifestyle.”
Excell said Victoria Police became aware of Jordanou’s activities, and those of his associates, when the Commonwealth Bank discovered a number of loan applications lodged on behalf of Jordanou’s clients were supported by false documents, including ATO documents, letters of employment and financial statements.
The bank lodged complaints against accounting firm Zaia Arthur &amp; Associates, where Jordanou was working as a “financial adviser” at the time.
SmartCompany attempted to contact Zaia Arthur &amp; Associates this morning but the phone number listed for the firm has been disconnected.
Jordanou’s lawyer, George Defteros, told Fairfax his client has “been waiting for these charges for two-and-a-half years … and we welcome these charges because Mr Jordanou wants to get on with his life”.
Mark Rantall, chief executive of the Financial Planning Association of Australia told SmartCompany there are a number of rules individual investors and small business owners should follow to safeguard themselves against unsound financial advice.
Rantall says the "golden rule" is to always check the qualifications of the person giving the advice and to make sure they are a member of the FPA, which is the national professional association for financial planners.
“The second golden rule is that if something sounds too good to be true, it usually is,” says Rantall. “If you are being offered a get-rich-quick scheme, the risk associated with that scheme will be extraordinarily high.”
“The third rule is that your financial planner should spend more time talking about you and your investments, than themselves and the products they may be offering,” says Rantall.
Rantall says it is also important to make sure your financial plan matches your own personal risk profile, and that your investments are diversified across different products and different asset categories.
“The final thing would be to make sure you keep you to date with your portfolio and that you always feel comfortable with the investments being recommended,” says Rantall. 
A spokesperson for the FPA told SmartCompany individuals and business owners who are concerned about receiving sound financial advice can use the <a href="https://fpa.com.au/find-a-planner" target="_blank">“Find a Financial Planner” function</a> of the FPA’s website to find an expert, as FPA members are held to higher professional standards. 
This article first appeared on <a href="https://www.smartcompany.com.au/" target="_blank">SmartCompany</a>.
</body></html>

ekeating-PWvazjYE25

Melbourne financial planner faces court over $100 million fraud charge

<html><body>
ACT police are investigating a real estate fraud after a Canberra home sold without the consent of the absentee landlord home owner.
The real estate scam at <a href="https://www.urban.com.au/property-observer" target="_blank">Macgregor</a> has all the hallmarks of prior fraudulent sales by overseas fraudsters.
The owner, living in South Africa, discovered the north side house had been sold after contacting her local ACT property manager as she had not receive the past four rental payments. 
ACT Police has taken control of the investigation in consultation with police in South Africa. 
"Police will investigate a series of exchanges which led to the sale of the property without the owner’s knowledge or consent, and the disbursement of the funds generated by the deception," the statement said.
The ACT Attorney General Simon Corbell has warned home owners to be vigilant of scammers.
The details of the Macgregor scam have not been publicly released, but Property Observer notes sales over the period between last October and February this year ranged between $200,000 and $560,000. There was a $335,000 average sale price.
There have been similar cases in WA including two successful sales and six attempted real estate frauds.
The ACT Real Estate Institute CEO, Ron Bell told 2CC Capital Radio that agents and homeowners must be wary as the scammers tend to get through the web.
YOU MAY ALSO LIKE TO READ: 
<a href="/news/33749-14-anti-fraud-tips-for-investment-property-vendors" target="_blank">14 anti-fraud tips for investment property vendors</a>
 
 
</body></html>

jchancellor-FAypfDUnLy

Absentee Macgregor landlord loses ACT home to South African fraudster

<html><body>
The Real Estate Institute of New South Wales is lending its voice to warnings from the New South Wales Minister for Fair Trading about the risk of property fraud. After an <a href="/news/act/33743-absentee-macgregor-landlord-loses-act-home-to-south-african-fraudster" target="_blank">ACT landlord's home was sold</a> without his consent while he was overseas, NSW minister Matthew Mason-Cox advised real estate agents to remain aware of the risks of fraud. “Identity fraud and scams are increasingly common throughout the community and the property industry is not immune to this criminal activity," said Mason-Cox. “Once a fraudster has a target they will contact the managing agent, pretending to be the property owner, and request their address and contact details be changed, cutting the real owner out of future correspondence.
“Soon after this, the fraudsters are back in touch with the agent requesting the property be sold. The intention is that once the property is sold, the fraudsters intercept the settlement paperwork, steal even more of their victim’s identity and ultimately take the proceeds of the sale.”
NSW Fair Trading introduced guidelines for preventing fraud in real estate in 2012, including a proof of identity checklist for vendors.
Malcolm Gunning, president of the Real Estate Institute of New South Wales (REINSW), said the group supports NSW Fair Trading's guidelines. “We take matters of fraud and fraud prevention very seriously,” said Gunning.   “At our recent roadshow events across NSW we spoke to over 1,000 members about possible identity fraud and the key signs to watch for, including requests for contact details to be changed.”   “We have instructed our members to be vigilant and take the guidelines seriously," Gunning said.   “We need co-operation from the public who should be aware that Real Estate professionals will ask them for identification, they should not be offended if an agent seeks extra documentation.     “The NSW Police or NSW Fair Trading should be contacted if identity fraud is suspected," he advised.
YOU MAY ALSO LIKE TO READ: 
<a href="/news/33749-14-anti-fraud-tips-for-investment-property-vendors" target="_blank">14 anti-fraud tips for investment property vendors</a>
</body></html>

REINSW lends support to minister's fraud warning

<html><body>
A Sunbury man appeared in the Melbourne Magistrates Court after the Australian Securities and Investment Commission alleged that he fraudulently obtained more than $1 million from investors.
Barry John Patrick, a 71 year old from Sunbury, Victoria, allegedly obtained the money from 14 investors between 2007 and 2010, telling investors it was to be used to fund a property development.
The Australian Securities and Investment Commission (ASIC) allege that Patrick took some of the funds for personal use, and used some of the money to pay interest payments to past and existing investors and to make loan repayments. According to ASIC, investors were persuaded to refinance their self managed superannuation funds and homes, take out additional loans or use credit cards to pay Patrick.
Patrick has been charged with eight counts of obtaining property by deception, five counts of obtaining financial advantage by deception, one count or theft and one count of running a financial services business without an Australian financial services license.
The charges relate to the three-year period between 2007 and 2010, in which ASIC alleges Patrick formed companies to purchase properties for development and consequently persuaded investors to refinance their homes or self-managed super funds, or take out additional loans or credit cards.
“ASIC allege the funds raised by Mr Patrick were not used to develop the properties, instead, they were used to pay interest payments to past and existing investors and to meet repayments on loans as well as for personal use,” said the regulator.
But this is not the first time Patrick has fallen on the wrong side of the law.
In 2010, Patrick <a href="https://www.asic.gov.au/asic/asic.nsf/byheadline/10-257AD+Melbourne+director+sentenced?openDocument" target="_blank">received a four-month suspended jail sentence</a> and a five-year good behaviour bond after pleading guilty to one charge of carrying on a financial services business without holding an AFS license and three charges of managing a corporation while disqualified.
According to ASIC, during August 2003 and December 2006, Patrick persuaded 40 investors to invest in three companies: E.K.B Properties, Sandgrove Specialised Securities and Cardinia Specialised Securities.
During the time, E.K.B Properties raised approximately $4 million, Sandgrove Specialised Services raised approximately $1.5 million and Cardinia Specialised Services raised approximately $1 million.
<a href="https://www.moneymanagement.com.au/news/superannuation/2014/victorian-charged-with-smsf-property-fraud" target="_blank">According to Money Management</a>, ASIC alleged Patrick and his associate Karl Heinz Veljkovic were pushing investors to roll over their superannuation into self-managed funds and then invest those funds into the three companies.
However, the companies, which were controlled and managed by Patrick and Veljkovic, were placed into liquidation by the Federal Court in 2007 following investigations by ASIC. As of December 2010, ASIC said none of the investors had been repaid.
In 2007, both men consented to Federal Court orders banning them from carrying on a financial services business; parting with any funds that have come into their possession by issuing, selling or offering a financial product; and managing corporations for a period of 20 years.
Graeme Colley, director of technical and professional standards at the SMSF Professionals’ Association of Australia, said these kinds of cases arise from time to time, and are the result of a “failure of the independence between initial advice given to individuals and where the money ends up”.
Colley says cases like this don’t preclude investing your self-managed super fund in property, but says “the hotter it gets, the closer you are getting to the fire”.
As a general rule, Colley says investors should only consider advice from advisers with AFS licenses. This way, if something goes wrong, the investor potentially has some recourse against the licensee and can use formal complaints arrangements.
Colley says it is also important to do your own research and be as thorough as possible. “Make some investigations into who owns the business, the relationship between the adviser and the organisation, and if there are any other real investors,” says Colley.
Patrick is next due to appear in court on 16 September. He faces a maximum 10 years in jail for each of the deception and theft charges, and a maximum jail sentence of two years if found guilty of operating a financial services business without an AFS license.
Parts of this article first appeared on <a href="https://www.smartcompany.com.au/" target="_blank">SmartCompany</a>.
</body></html>

Melbourne property developer charged with $1 million fraud

<html><body>
A former real estate agent, Afif Shaba, has been banned from holding a real estate licence for eight years due to his part in a $50,000 trust account fraud.
Shaba authorised his business, Northern Real Estate Pty Ltd, to fraudulently use $50,000 of trust account money that had been received between January and November 2012 for their own purposes, found the Victorian Civil and Administrative Tribunal.
VCAT found Shaba guilty of conduct that made him unfit to hold a licence.
Shaba was the sole director and officer in effective control. The funds used was tenants’ rent that was owing to the investors, and it was found he breached the Estate Agents Act 1980 by knowingly authorising the business not to retain the funds.
He had withdrawn the trust money to pay business expenses in March 2012. This was due to a downturn leaving him in financial difficulty, and saw Shaba admit this to Consumer Affairs Victoria inspectors.
At one point it was noted that there was a $50,000 deficiency in the trust fund, reduced to $15,000 when he was inspected in November 2012.
Shaba looked to pay back the missing funds, have his accounts audited, sell the business and stop operating as a real estate agent. His agency’s licence was cancelled in March 2013.
He will be eligible for a licence after 9 July 2022.
Edit: The above story has been amended. Details provided by Consumer Affairs Victoria included inaccurate references to agency details.
</body></html>

Victorian agent banned for eight years after $50,000 trust account fraud

<html><body>
An ASIC investigation found that Shashi Kanta Prasad of Chipping Norton, New South Wales, had created false loan documents for seven clients to achieve loans totalling more than $3.6 million.
She pleaded guilty in the Downing Centre Local Court to making seven false statements, producing 41 fake documents and using those documents to obtain a financial advantage for her employer in the form of commissions.
She was employed by <a href="https://www.rajprasad.com.au/contact" target="_blank">Raj Prasad &amp; Co Pty Ltd</a>, trading as <a href="https://www.platinumaccountants.com.au/" target="_blank">Premium Financial &amp; Retirement Solutions</a>.
She faces a maximum imprisonment of five years for one offence of obtaining a financial advantage by false or misleading statements, a maximum penalty of five years for one offence of intention to defraud by false or misleading statement, a 10 year maximum penalty for one offence of using false instruments, and  a maximum penalty of 10 years for one offence of using false documents.
The Commonwealth Director of Public Prosecutions is prosecuting the case, with sentencing at the Sydney District Court on 18 July 2014.
A previous July 2012 MFAA notice said: "The MFAA Tribunal has expelled Mrs Shashi Prasad from MFAA membership on the basis that she engaged in, or was vicariously liable for conduct of a misleading, deceptive, dishonest or fraudulent nature. The Tribunal had before it four allegations of such conduct."
</body></html>

Fraud

Editor's Picks

Have something to contribute?

Developments

New apartments

New townhouses

News

Fraud

Editor's Picks

Receive the latest news stories to your inbox

Have something to contribute?

Developments

New apartments

New townhouses

News