ASIC has permanently banned former Astarra Asset Management Pty Ltd (AAM) director, Mr Eugene Liu, from providing financial services for failing to comply with financial services laws.

Mr Liu’s banning is a result of ASIC’s continuing work into the collapse of Trio Capital.

Mr Liu was a director and chief investment strategist of AAM (formerly Absolute Alpha Pty Ltd) from 12 July 2006 until it was placed into liquidation on 22 December 2009.

AAM was appointed by Trio Capital Ltd (Trio) as the investment manager of the assets of Astarra Strategic Fund (ASF). ASF was a fund of hedge funds and its responsible entity was Trio. As a result of marketing and promotion of ASF by AAM, money was invested in ASF from 15 February 2006 until 30 September 2009. In December 2009, ASF had reported assets of $125 million.

An ASIC investigation found Mr Liu engaged in dishonest conduct and conduct that was misleading or likely to mislead during his time as a director of AAM. Specifically, ASIC found Mr Liu engaged in:

• dishonest conduct with respect to incorrect statements made in the ASF Product Disclosure Statement

• dishonest conduct and conduct which was misleading or likely to mislead regarding a research report about ASF

• dishonest conduct in receiving more than $388,041 in payments outside his salary, as a reward for his involvement in the investment of ASF assets in certain funds; and

• dishonest conduct and conduct which was misleading or likely to mislead in hiding where ASF investment money would ultimately be placed.

ASIC Chairman Greg Medcraft said, ‘Mr Liu’s banning should act as a deterrent to all those in the industry. Australian investors should be confident and informed, and those individuals who do not promote these values when dealing with consumers have no place in the industry’.

Mr Liu has the right to apply to the Administrative Appeals Tribunal for a review of ASIC's decision and is currently exercising those rights with an appeal to the Tribunal.

Investigations by ASIC into Trio are continuing.

Background to ASIC Action on Trio

ASIC has taken enforcement action on Trio against a range of gatekeepers. This includes directors of Trio, its investment manager, various financial planners who recommended Trio and Trio’s auditor.

As a result of ASIC’s continuing Trio investigations more than 10 individuals have either been jailed, banned from providing financial services, disqualified from managing corporations or have agreed to remove themselves from participating in the financial services industry for a combined total of more than 50 years (refer 12-116MR).

[This media release was amended on 12 April 2023 in accordance with ASIC policy - see INFO 152 Public comment on ASIC's regulatory activities.]

Editor's note 1:

On 18 October 2013 the Administrative Appeals Tribunal dismissed Mr Liu's application for a review of ASIC's decision.

Editor's note 2:

On 4 December 2013, the Administrative Appeals Tribunal reinstated Mr Eugene Liu's appeal against his permanent ban from providing financial services. The matter was reinstated following an application by Mr Liu.

Editor's note 3:

On 29 April 2014 Mr Liu's request for review of his permanent ban from providing financial services was heard. The decision has been reserved.