Australian Securities & Investments Commission secures Federal Court finding that Mayfair 101 director James Mawhinney was involved in misleading marketing and unlicensed financial services

The Australian Securities & Investments Commission (ASIC) reported that the Federal Court has found Mayfair 101 Group director James Mawhinney was associated with or involved in contraventions of the law by Mayfair 101 Group companies, following ASIC proceedings. The Court found the companies made multiple false or misleading representations when marketing the M+ Fixed Income Notes, M Core Fixed Income Notes and Australian Property Bonds across periods between 3 July 2019 and 5 May 2020. It also found misleading or deceptive conduct from 11 March 2020 to just prior to 2 April 2020 due to marketing materials failing to disclose that investor redemptions had been suspended, and determined that IPO Capital carried on a financial services business from 2016 to December 2017 without an Australian Financial Services Licence. However, the Court rejected ASIC’s allegations that the Core Notes and M+ Notes were represented as comparable to bank term deposits, that certain representations about the use of invested funds and security to be granted were misleading, and that family trusts associated with Mr Mawhinney received amounts traceable to Core Notes investments. ASIC is seeking injunctions to restrain Mr Mawhinney from advertising and fundraising through financial products and from removing from Australia any assets acquired with funds received in connection with a financial product. The parties are to provide any further submissions on relief within 21 days after Mr Mawhinney requested an opportunity to make further submissions following the decision.