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BFCSA: Angry Letters from Victims of Lazy ASIC re Sterling Collapse # 17

Posted by on in ROYAL COMMISSION INTO ASIC NEGLIGENCE
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Dear Mr Shipton

 

 

 

RE: “Investment” in collapsed Sterling First Group of companies. ASIC negligence -Sterling First under ASIC investigations kept quiet.

 

 

I am a single mother of 2, 58 years old, who migrated to Australia in 1984 and worked, paid taxes all these years in this country.

 

In 2016 I came across Sterling First offer of investments in their various propositions and schemes. At that time, having lost work after 30+ years with the same firm, I was looking for a new job with not much luck, was vulnerable and desperately wanted to improve my cash flow. My house was nearly paid off and I had access to equity. After numerous meetings and familiarising myself with presented documents on the company’s position, I have decided to use my equity money to invest. That was supposed to be only for a short term until I found new job. I was assured that I can sell shares at any time.              

I have invested $400,000 in shares, $60,000 in SIT Development units run by Theta (The Responsible Entity??) and $59,400 in co-development units – for only 8 months duration.

 

I found a new job in early 2017 – over year after losing the previous one, and started making enquiries about selling shares. No option. We, as investors, were informed that company is going to be listed on ASX very soon and this will allow us to liquidate the investments. This story was repeated until May 2019 when Sterling First went into administration. Dividends stopped being paid in mid-2017 with an excuse that it is all because of audits taking place! Re-structure was also on the cards.         

 

I only found out about ASIC investigations into Theta and Sterling First this month! After company went into liquidation!  And these investigations were as early as 2015, 2017!! How come no one was obliged to inform investors or stakeholders?? Why shareholders were not issued a warning?? Why all this was being kept behind closed doors while the company operated as usual and money was pouring in? Isn’t there an obligation to communicate with investors about company’s doings? I have tried on numerous occasions to get any information on company’s financials but never got any answers!! The only excuse I was given – wait for ASX listing! So, I waited and kept paying interest on invested money… that amounts to approx. $2,200/month! No more dividends since 2017.

 

Why this company was able to lure in new investors while under ASIC investigations??

Why Sterling First was allowed to maintain its promise of ASX listing to investors while under ASIC investigations until late May 2019?? Who is responsible for this?? Why the company was allowed to stop paying dividends with an excuse of audits? Who was doing auditing for Sterling First? Maybe KPMG banned once by ASIC from auditing Westpoint that collapses? Why KPMG is allowed now to be the Liquidator? Same people? Same problems?

 

 

I believe there is a lot of wilful negligence from ASIC, that needs to be addressed and responsibility taken! ASIC who supposed to be on the Consumer’s side. What is the purpose of ASIC investigations then?? And we pay our taxes to fund this body. Over $400mln. Now I want and I demand compensation.

 

Looking back, I believe Sterling First mislead, lied and used the investors, all under ASIC careful investigations. All looks like a complicated Ponzi scheme to me with seamingly good cause. But at the time in 2016 , all looked sound, company expanding into VIC and QLD with good prospects of growth and helping retirees to find affordable accommodation. Great investment! I was led to believe in it for over 3 years. I don’t consider myself a naive person. I am educated professional that was diligent in checking provided documents before investing. I am not a gambler.

 

Why Sterling First was allowed to trade while under Administration? I was offered shares for my Co-Development Agreement of $59,400 in value, with shares of $0.20/share value in late May 2019 under condition of releasing all responsibility from Sterling First?? How on earth anyone can came up with this concept and figure under those circumstances? This is happening under Administration that I wasn’t aware of – no communication from the Company! This is to me criminal.

 

Sterling First has to be held responsible for all wrong doings and ASIC for criminal negligence. All people who invested and lost everything have to be compensated. How many people are affected? Few hundred. Mainly old who have served this country, paid their taxes all their lives. They have lost EVERYTHING! Today, we have more rights to return a broken toaster and sue supermarket for wet floor if you twist your ankle.

 

Why did the Director resign a few months prior Administration while being investigated?  

 

Today I am faced with losing my home, and paying the loan from a pension when I retire. My $100,000 superannuation, that I can’t even access today, will not even pay for a quarter! If I lose my job tomorrow, you better burry me alive.

 

Apart from my children, all my family (seriously mentally sick mother and sister) live in Poland. I won’t be able to visit, nor help them anymore. I didn’t tell my kids about the loss, as it will devastate them. My role as a mother is to protect them. I will not want to accept their offer of help, as it would be an enormous pressure on them when they are just starting their independence.

 

What is worse, that I cannot re-finance to a better deal with any bank (my loan currently is with ANZ) and I pay high interest, as I don’t qualify based on serviceability according to new regulations! Just keeps coming. So not only I lost $520k but I have to keep paying high interest on this money until I die, and then my children have to finish it.

 

I am being penalized for someone’s stuff ups, and no responsibility is taken for it.

 

I still can’t come to terms with this situation. I am in a deep depression, stressed and been referred to see psychologist. But I can’t afford to pay the fees! I have only $50/week +bills to live on if I keep my job. I have to cut off my private health insurance. God knows what will happen if I fall sick.

 

If ASIC had been warning about Theta and Sterling First at the time of investigations, I would not have invested there!

 

What is the purpose of ASIC? Being funded by our tax money, there is NO PROTECTION from known scams and structures.

All I hear from Theta, KPMG is ‘sorry- no funds left, you should not have invested there… ‘. Iwouldn’t if ASIC acted diligently.

 

I want answers and compensation.

 

 Yours faithfully

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Guest Saturday, 21 September 2019