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A mid-tier firm has been appointed receiver and manager over the assets of an entity under investigation by ASIC.
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Court appoints mid-tier amid investigations into dodgy firm
05 November 2018
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The Queensland Supreme Court has appointed Anthony Castley of William Buck as receiver and manager over the assets of Goldsky Global Access Fund Pty Ltd, Kenneth Charles Grace and associated entities.
Freezing orders were also made restraining the disposal of any property, including money and securities by Mr Grace, Goldsky Global Access Fund Pty Ltd, Goldsky Asset Management Australia Pty Ltd and Goldsky Investments Pty Ltd.
ASIC alleges that Mr Grace, through his companies operated a financial services business without holding an AFSL and, since at least 5 June 2018, was aware that an AFS licence was required; and operated an unregistered managed investment scheme called ‘Goldsky Global Access Fund’ that has raised more than $16 million from more than 50 investors.
The corporate regulator also alleges that Mr Grace used investor funds for his own personal use, including substantial payments to family members and the purchase of personal items.
The case
In March 2017, Mr Grace, through his company, Goldsky Asset Management LCC, a US-incorporated company, advised ASIC that it had commenced operating a financial services business in Australia.
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Goldsky Asset Management LLC purported to rely on relief from the requirement to hold an Australian Financial Services licence available to certain foreign financial services firms providing services to wholesale clients in Australia on the basis that they are subject to equivalent regulation offshore.
Goldsky Asset Management LLC was authorised as an ‘investment advisor’ by the United States Securities and Exchange Commission (SEC).
Goldsky Asset Management LLC had appointed Goldsky Asset Management Australia Pty Ltd as its agent in Australia.
On 5 June 2018, ASIC advised Goldsky Asset Management LLC that ASIC considered that it was no longer entitled to rely on the relief as it had not complied with the conditions of the relief.
Separately, on 27 September 2018, the SEC filed a civil suit in the United States District Court, Southern District of New York against Goldsky Asset Management LLC and Mr Grace for making false and misleading statements about its business in filings with the commission and on its website.
William Buck’s Mr Castley is to provide a report to the court by 26 November 2018.
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