Court deals killer blow to Mayfair director

THE Federal Court has dealt a hammer blow to the director of besieged finance outfit Mayfair 101, which now leaves a $1.6bn tourism vision for Mission Beach and Dunk Island all but dead in the water.

On Monday Mayfair 101 managing director James Mawhinney was banned from advertising investments and accepting funds from any financial product for 20 years.

And assets secured through Mayfair products can’t be transferred out of the country.

The decision is a final blow to the Mayfair founder following an Australian Securities and Investments Commission move to shut down investment products that were found by the court to “mislead and deceive” mum and dad investors lured by the promise of security claimed to be similar to that of a bank.

ASIC deputy chair Karen Chester heralded the court’s action as a success despite Justice Stewart Anderson finding middle ground between a life ban pushed for by ASIC and a 10-year restraint argued for by Mr Mawhinney’s legal team.

“This action is one of several under ASIC’S True to Label project targeting investment managers and issuers of other financial products who have lured unsophisticated investors into high-risk products via misleading marketing,” she said.

In his judgment, Justice Anderson savaged Mr Mawhinney for a “total disregard for the Corporations Act and the ASIC Act”, noting he had “no confidence that he will adequately comply with the obligations set out in the legislation in the foreseeable future”.

Mission Beach real estate agent Graham Anderson was among more than 200 Mission Beach property owners who sold to Mayfair in an ambitious bid to establish a tourism mecca on the Cassowary Coast.

He said he was unsure of what the latest financial setback would actually mean for the town.

“We need to have a plan B but no one knows what it is yet,” he said.

A penalty hearing based on Corporations Act breaches will sit in July.

Mr Mawhinney has contacted for comment. been