ASIC, Commercial Property

ASIC wraps up last action against Westpoint

ASIC has concluded the final class action related to failed property development group Westpoint, 10 years after the action first began and 13 years after the group collapsed.

The corporate regulator noted action against Brighton Hall Securities, a financial services licensee that recommended Westpoint products, was dismissed in the Federal Court in Perth on 7 March after liquidators for the company completed the distribution of damages to clients of the firm.

Brighton Hall Securities carried on a financial services business from Perth suburbs Applecross and South Perth and entered into liquidation in September 2007.

Under its powers, ASIC was able to begin civil proceedings for damages for investors, and using claims against insurance money recovered by the liquidator was able to return $1.5 million to 201 former Westpoint investors who were members of a claim. The regulator said the final dividend represented a return of 22.35 cents in the dollar on the total claims of the investors for $6,652,702.

The action was one of 19 civil actions initiated by the regulator to recover funds for Westpoint investors against Westpoint-related companies and their officers, the Westpoint auditor and financial services licensees whose advisers recommended Westpoint products.

ASIC said the collapse of Westpoint in late 2005 resulted in 3000 to 4000 investors losing $388 million, but up to $170 million had been returned to investors. Around $78.5 million of this sum was recovered from the liquidation process and Westpoint companies not in liquidation, and nearly $93 million in compensation from ASIC’s actions.

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