The Australian Securities and Investments Commission (ASIC) has banned Joshua David Fuoco of Prahran in Victoria from providing financial services for five years.
This follows an investigation into the Dollarforce Group of companies, in particular Elite Equities Limited (Elite) and Mr Fuoco. It shows Joshua David Fuoco was an Authorised Representative of Elite, a Financial Planning business associated with the Dollarforce Group between 23 February 2005 and 11 November 2008.
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”ASIC found that Mr Fuoco did not comply with financial services laws by:
1) Recommending interests in unregistered managed investments schemes when it would have been apparent to Mr Fuoco that these schemes required registration;
2) Failing to have a reasonable basis for advice he provided to retail clients of Elite;
3) Failing to disclose in statements of advice he provided to clients: a) information about remuneration (including commissions or other benefits) payable to Mr Fuoco, namely bonuses which might reasonably be expected to be capable of influencing the advice provided by Mr Fuoco; and b) this information in dollar terms.
4) Failing to disclose in statements of advice he provided to clients information about certain interests of his and his associates, and relationships he or his associates had with product issuers which might reasonably be expected to be capable of influencing the advice provided by Mr Fuoco.
As such, Mr Fuoco engaged in conduct that was likely to mislead his clients. Mr Fuoco has the right to lodge an application for review of ASIC’s decision with the Administrative Appeals Tribunal.”
After receiving information and complaints from the public, ASIC started an investigation into the Dollarforce Group of companies in December 2008. It appeared Dollarforce may have raised $45-60 million from the public.
Members of the public invested through Dollarforce in various property-related investments including a loan programme from which investors were to receive interest payments of between 10 and 14%. Some of the investors were clients of Australian Financial Services Licensee Elite Equities Pty Ltd.
In February 2009 ASIC took urgent action in the Federal Court obtaining injunctions preserving the assets of eight companies in the Dollarforce Group. ASIC also obtained injunctions preserving the assets of Mr Clestus Weerappah and Ms Andrea Hawkins and preventing them from leaving Australia. Mr Weerappah and Ms Hawkins were directors of companies in the Dollarforce Group.
In April and May 2009, on ASIC’s application, the Federal Court ordered that the eight companies in ASIC’s action be wound up and a liquidator appointed, bringing to ten the total number of companies in the Dollarforce Group in liquidation. Federal Court injunctions against Mr Weerappah are still in place.
ASIC’s investigation is continuing.
The ASIC investigation discovered that, between July 2005 and September 2007, Mr Fuoco recommended various financial products offered by companies in the Dollarforce Group to clients of Elite. It appears Mr Fuoco did not have a reasonable basis for the advice he gave and engaged in misleading and deceptive conduct. Mr Fuoco provided clients with defective disclosure documents that failed to disclose details of his and Elite’s remuneration and various interests and associations that may have affected the advice he gave.
Gillian Lilley
Freelance Business Writer
