The Federal Court has banned Bradley Grimm and Vanessa Ash from providing financial services for 20 and 10 years respectively and from managing corporations for 15 and seven years respectively after finding them guilty of dishonest conduct.
The ruling also included winding-up orders for Ostrava Equities and eight other associated companies, all of which had Grimm and Ash as proprietors.
Aside from Ostrava Equities, the other companies in the financial services group were Ostrava Asset Management, Ostrava Securities, Ostrava Wealth Management, Beta Pharmacology, Prometheus Capital, Thrive Lending, Trade BTC and Equity Capital Partners Hedge Fund.
The Federal Court in Melbourne found Grimm, in his capacity as an SMSF adviser, had committed multiple breaches of financial services laws in his operation of the companies.
In particular, the court found Grimm breached the Corporations Act by providing unlicensed managed discretionary account services, failing to satisfy his financial services disclosure obligations, failing to act in his clients best interests and making misleading statements to clients about the value of their SMSFs.
In addition, Justice Davies found Ostrava Equities and Grimm had charged unauthorised fees to clients dishonestly.
Both Ash and Grimm were found to have breached their company directors’ duties.
In handing down the ruling, Justice Davies said Grimm’s conduct was “deliberate and in contumelious disregard of the law and statutory requirements” and he had engaged “in deliberate courses of conduct to enrich himself and the corporate group that he established at others’ expense”.
In regard to the involvement of Ash, who is a lawyer and former Australian Securities and Investments Commission (ASIC) employee, Justice Davies said she knew or ought to have known the proper standard of conduct the law required, but chose instead to rely on Grimm’s operation of the financial services business without proper scrutiny.
“This outcome sends a message that anyone who breaches financial services laws or their duties as company directors faces serious consequences,” ASIC commissioner Greg Tanzer said.
“ASIC will not tolerate this kind of egregious misconduct.”
