ASIC update: Sterling Group Investigation
ASIC announces penalties against Theta and Managing Director Robert Marie in the Sterling Group investigation. Find out the details of the violations, including defective Product Disclosure statements, and the imposed penalties. Stay informed about ASIC’s ongoing investigation into the conduct of entities and officers involved in the Sterling Group.
Western Australia- The Federal Court found Theta Asset Management LTD (Theta), who is currently in liquidation, and the Managing Director, Robert Marie, violated the Corporations Act on numerous occasions by authorising the issue of five defective Product Disclosure statements for Sterling Income Trust.
As ordered by The Court, Theta must pay a penalty of $2 Million and Marie pay a penalty of $100,000. In addition to penalty fines, Marie is disqualified from managing corporations for four years. The ASIC has chosen not to seek a penalty against Theta, as this would decrease the available funds from liquidation for distribution to Theta’s creditors.
The proceedings against Theta and Marie were made on 11 December 2019 by the ASIC. The Court found a breach in the Corporations Act by both Theta and Marie, and both Theta and Marie failed to comply with duties as a responsible entity and managing director.
Both Theta and Marie admitted to both charges in a Statement of Agreed Facts and Admissions filed with the Court along with joint submissions for declarations, civil penalties, and the disqualification order to be imposed.
According to The Hon Justice McKerracher, he handed down his judgment on the basis of circumstances involved in fatal losses sustained by investors.
Cathie Armour, an ASIC Commissioner, stated ‘The Federal Court outcome sends an important deterrent message to other responsible entities, as well as those entrusted to act as gatekeepers, to ensure they comply with legal obligations. ‘
‘ASIC will take action to hold gatekeepers to account.’
Between 20 May 2016 and 30 April 2018, a total of $16,749,974 was raised from retail investors in agreement with the defective Product Disclosure Statements.
At this time, the ASIC continues its investigation with regard to the conduct of entities and officers in the Sterling Group.
