Following legal proceedings initiated by the Australian Securities and Investments Commission (ASIC), the Federal Court has found Mayfair 101 Group director James Mawhinney was associated with or involved in contraventions of the law by entities associated with the organisation.
The court ruled against Mawhinney concerning three separate activities, the first of which was making multiple false or misleading representations in the marketing of the group’s M+ Fixed Income Notes, M Core Fixed Income Notes and Australian Property Bonds across various periods between 3 July 2019 and 5 May 2020.
Further, it was decided Mayfair 101 Group companies had engaged in misleading or deceptive conduct when the fact investor redemptions had been suspended was not disclosed in relevant marketing materials.
Finally, the court found Mayfair 101 Group company IPO Capital was not the holder of an Australian financial services licence from 2016 to December 2017 when it was operating a financial services business.
Mawhinney was deemed by the court to have been associated with or involved in all of the above contraventions.
On a more positive note for Mawhinney, the court disagreed with ASIC’s belief the Mayfair 101 Group companies claimed the M+ Fixed Income Notes and M Core Fixed Income Notes were comparable to and had a similar risk profile to bank term deposits.
ASIC’s allegation family trusts associated with Mawhinney received amounts traceable to funds invested in the M Core Fixed Income Notes was also rejected in the legal process.
Rhys Roberts, Mawhinney’s instructing solicitor and managing partner of Roberts Gray Lawyers, welcomed the findings in Mawhinney’s favour.
“[The] judgment is significant progress toward clearing Mr Mawhinney’s name. We successfully defended significant parts of ASIC’s case. We look forward to Mr Mawhinney continuing to rebuild so Mayfair 101’s lenders can be made whole regardless of the court outcome,” Roberts said.
Mawhinney requested an opportunity to make further submissions on relief following the decision and needs to do so within 21 days.
