Banned adviser still living large
BANNED financial adviser Jeff Worboys enjoyed a VIP jaunt at Polo by the Sea while more than 10,000 investors in his failed Halifax Investment Services worried about their $211 million, frozen in the company’s trust accounts since November.
Halifax Investment Services was placed in voluntary administration in November, and into liquidation in March.
More than $211 million of investors’ money remains frozen as investigators try to untangle a web of intermingled funds – but there is a shortfall in trust accounts of $19.7 million.
The liquidators said investors could see anywhere between 83 and 94 cents in the dollar of what they invested returned to them, dependent on the shortfall being recouped from “third parties”.
Most of the investors’ funds are held in “open positions” meaning they are liable to fluctuate in line with the market.
Mr Worboys has not let the troubles cramp his lifestyle, with administrators previously finding he still owned a Bentley paid for by the company and was living in a luxury rented home at Paradise Waters.
Even as ASIC continued to investigate potential director misconduct in his company, Mr Worboys and wife Pat relaxed in the VIP section of the exclusive Polo by the Sea event earlier this month.
ASIC suspended the company’s financial services licence on January 8, four days before the couple was snapped enjoying the exclusive luxury of The Dome at the Gold Coast Magic Millions Race Day.
The family later splurged on a luxury 20-day cruise aboard the Queen Mary 2.
In their latest report lodged with ASIC, liquidators from Ferrier Hodgson said there were 10,455 unsecured creditors owed $36.1 million and 19 priority creditors owed $108,791, who could expect to see anywhere between 51 per cent and 100 per cent of the funds.
A large part of the liquidators’ work has been formulating a legal strategy across Australia and New Zealand to enable them to apply to the Federal Court to return some of the investors’ funds.
They have had to comb through more than 35,000 transactions and estimated there is $19.7 million missing from clients’ money.
They previously reported almost $4.8 million worth of transactions that may be recovered from “third parties”, including $1.98 million in director loan account reductions days before the company went into administration; a $609,346 leave payment to Mr Worboys; a loan payment to another of his companies, AMH, for $124,301; rent payments of $49,631; a rental bond of $6087; and a $39,377 payout of a Bentley lease.
They found Halifax had likely failed because client funds were used to prop up the company’s operating losses “since at least January 2017”, and say the company may have been operating while insolvent since that time.
They found extensive “comingling” of accounts, meaning investor funds were improperly moved between trading platforms and accounting irregularities in documents lodged with ASIC.
Halifax was also drawn into what’s been described as “Australia’s biggest Ponzi scheme”, Courtenay House Capital Trading, which took $209 million from 780 investors. In April Mr Worboys was banned from the financial services for six years in relation to that case.