Court sides with ASIC over appointment of interim receivers to assets of Chris Marco and AMS Holdings

Maria Nikolova

Justice McKerracher finds that the orders sought would allow interim receivers to identify and value property available for distribution to investors.

The Australian Securities and Investments Commission (ASIC) has marked progress in its action against Chris Marco, AMS Holdings (WA) Pty Ltd (AMS), and AMS as trustee for the AMS Holdings Trust.

As per FinanceFeeds’ earlier reports, ASIC alleges Mr Marco has been raising funds from investors since January 2010, in contravention of section 911A (the requirement to hold an AFSL) and section 601ED (the requirement to register a scheme meeting certain criteria) of the Corporations Act 2001 (Cth). In total, Mr Marco received approximately $240 million from 132 investors. He falsely promised investors that there was a guarantee that their principal investment was secured. ASIC will allege that there is a very significant shortfall in the assets available to operate the scheme into the future.

Today, ASIC said it successfully applied to the Federal Court of Australia for orders to appoint interim receivers over the assets of Chris Marco and AMS. Robert Kirman and Robert Brauer of McGrathNicol, Perth, have been appointed to act as interim receivers.

The matter was heard on March 16, 2020 and today Justice McKerracher handed down his decision.

In his judgment, Justice McKerracher determined that that there is a strong need for this independent assessment due to the highly uncertain nature of the investment activities undertaken by Mr Marco and what appears to be a repeated failure over a lengthy period of time to generate material returns for most investors.

“There is also a serious concern, based on ASIC’s evidence, that the pooling of investor funds without adequate record keeping has meant that payment of some ‘returns’ to investors have come from contributions made by subsequent investors such that there now appears to be a shortfall in excess of $200 million between assets held by the defendants and amounts stated to be owed to investors”, Justice McKerracher said.

The orders sought would allow interim receivers to identify and value property available for distribution to investors, and to preserve property in the event that such distribution is ordered.

The interim receivers are first required to report back to the Court concerning the affairs of Mr Marco and AMS by July 26, 2020.

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