Former Equititrust CEO remains permanently banned from providing financial services

Mark McIvor, former chief executive officer and founding director of Equititrust Limited (in liquidation) (Equititrust) remains permanently banned from providing financial services after withdrawing an application to the Administrative Appeals Tribunal (AAT) to appeal against ASIC's original banning decision.

Mr McIvor was permanently banned from providing financial services on 2 September 2015 following an earlier ASIC investigation into the collapse of Equititrust.

At that time, Equititrust held an Australian financial services (AFS) licence and was the responsible entity of two registered schemes; Equititrust Income Fund (EIF) and the Equititrust Priority Class Income Fund (EPCIF) and was also the trustee of Equititrust Premium Fund (EPF); an unregistered managed investment scheme.

An ASIC delegate found that whilst he was the director of Equititrust, Mr McIvor contravened a financial services law and was not of good fame or character to provide financial services.

His conduct involved breaches of the financial services legislation which were considered to be very serious, repetitive, prolonged and dishonest.

In particular, the ASIC delegate found that Mr McIvor contravened financial services laws by:

• Signing 28 board meeting minutes, which falsely recorded a board meeting to approve a loan application had occurred, when no such board meeting had taken place, and in doing so, Equititrust did not meet its obligations under EIFs Compliance Plan; and
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• Failing to take all the steps that a reasonable person would take, if they were in Mr McIvor's position, namely to ensure that accurate, true and correct documents were relied upon for compliance checks and not be involved in the production of false documents.

Mr McIvor subsequently filed applications for a review of ASIC's decision to permanently ban him from providing financial services and to stay the operation and implementation of the banning order.

The stay application was refused by the AAT (refer 16-181MR) and on 1 September 2016, Mr McIvor withdrew his application for review of ASIC's decision to permanently ban him from financial services.

ASIC Commissioner John Price said Mr McIvor's conduct was at the most serious end of the offending range and that it was appropriate he be permanently banned from providing financial services.

'People who provide financial services, especially those in senior management positions, are required to discharge their obligations under financial services laws efficiently, honestly and fairly. ASIC will ensure those who fail in these duties are removed from the industry,' Mr Price said.

Equititrust was incorporated on 18 August 1993 and was placed into voluntary administration on 15 February 2012. 

The creditors of Equititrust resolved that the company should be placed into liquidation on 20 April 2012.

The voluntary administrators of Equititrust reported that as at the date of their appointment:

•     EIF had about 1620 unitholders who were owed approximately $203.6mil;
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•     EPF had about 38 unitholders who were owed approximately $56.7mil; and
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•     EPCIF had 5 unitholders and held no tangible assets.

On 19 December 2011, ASIC suspended Equititrust's AFSL for 12 months, for failing to comply with a number of key obligations as a financial services licensee (refer 11-306MR). Equititrust's AFSL remains suspended.

On 22 August 2014, Mr McIvor was convicted and fined $10,000 in the Brisbane Magistrates Court of six charges of failing to provide a Report as to Affairs and to deliver books and records to the liquidators of Chevron Capital Pty Ltd, MHSM Holdings Pty Ltd and SM Capital Pty Ltd (refer 14-223MR).

Mr McIvor was made bankrupt on 28 November 2012, however, his bankruptcy period has since expired.