A former financial adviser and former director of two financial services organisations has been charged in Lismore Local Court with 12 counts of dishonest conduct relating to $1.9 million held by SMSF clients.
The charges have been brought against Graeme Miller, of Myocum in northern New South Wales, for engaging in dishonest conduct contrary to section 1041G of the Corporations Act 2001 while running a financial services business.
The Australian Securities and Investments Commission (ASIC) determined Miller acted dishonestly between July 2013 and March 2017 when he was a director of CFS Private Wealth and CFS Corporation.
During this time, the corporate regulator found he encouraged his financial advisory clients of CFS Private Wealth to invest their money in CFS Corporation on the premise these funds would be invested properly. The amounts raised were instead used to pay dividends to other clients, to meet business expenses and for his own personal benefit.
Specifically, the charges relate to 12 investments made by seven of Miller’s clients, including SMSF trustees, totalling $1.9 million.
The matter has been adjourned until 17 December to be heard in the Downing Centre Local Court in Sydney. It is being prosecuted by the Commonwealth Director of Public Prosecutions.
In January, the Federal Court banned Miller from providing financial services for 25 years and disqualified him for three years from managing corporations.
These penalties were handed down after an ASIC investigation found he had advised CFS Private Wealth clients, including SMSF trustees, to invest $4.7 million in CFS Corporation and subsequently used these funds for his own personal expenses and to pay interest to other clients.
At the same time, the court wound up CFS Private Wealth and Combined Financial Solutions, which were organisations where Miller held directorships.
In handing down this decision, Justice John Reeves noted Miller’s “frequent and ongoing misuse of his clients’ superannuation savings for personal purposes over a number of years, in a long series of transactions which displayed what I consider to be a serious degree of personal dishonesty”.
