Debentures scheme lands Gore in prison
Former rich lister found guilty on six counts of fraud
A HIGH-FLYING property tycoon who was once named as one of Australia’s richest man has spent his first night behind bars after a judge found him guilty of defrauding more than $340,000 from investors.
Property developer Craig Gore, 53, was yesterday found guilty of six counts of fraud relating to a high-interest debentures scheme he ran between 2013 and 2014 from the Gold Coast.
The twice bankrupt businessman, who once owned a Supercars team and is the son of Sanctuary Cove developer Mike Gore, was accused of engaging in 12 counts of fraud for the benefit of the companies Arion Financial and Arion Group.
After a week-long judgeonly trial in the Brisbane District Court in July this year, Judge Michael Byrne yesterday found Gore guilty of six of the 12 offences.
The total amount prosecutors had alleged Gore defrauded investors of was more than $800,000 but Judge Byrne found him guilty of counts amounting to $345,000.
Judge Byrne said he was satisfied beyond reasonable doubt that Gore had caused the companies to gain the benefit alleged by prosecutors and that Gore had spoken with each victim fund director and convinced them to invest in debentures.
During the trial, the court heard the funds provided by mum and dad investors were used to pay creditors and wages instead of being invested in high-interest returns as claimed by Gore.
“In my view, it must have been apparent to the defendant that his projections were falling, vastly overshooting the actual within a matter of a few months,” Judge Byrne found.
“In that few months, the only significant income emanating from outside the Arion companies was from debentures, which in themselves created a liability to be repaid with interest.”
He said balance sheets showed the combined business equity of the companies was “relatively meagre” and that there did not appear to be any capital input that “far outstripped costs for the rest of the financial year”.
“Accepting that each new business venture starts out with a degree of honest optimism as to its prospects, it must have become quickly apparent to the defendant that the combined business’ income was falling far short of his hopes,” Judge Byrne found.
“I find that by about October 2013 the defendant must have held some doubts or reservations as to whether repayments could be made to cover any further “debenture” investments notwithstanding his initial optimism.”
The judge found that in relation to six of the fraud counts, Gore made dishonest representations to the investors after he was aware of the “poor combined financial state” of the Arion companies and after he became aware of a sizeable debt to the ATO.
Defence barrister Tony Glynn QC asked that Gore be allowed to continue on bail until sentencing on November 26, saying his behaviour on bail had been “exceptional”.
But Judge Byrne refused the application, saying there was a “high risk” of Gore being jailed for the offences.
“There can be no doubt that he has performed well on bail but there can also be no doubt his position has now changed given he has now been convicted ...,” he said.