Former property developer and financial adviser, Mr John Gerard Sage of Mount Eliza, Victoria, was sentenced today in the Melbourne County Court to two years imprisonment following charges brought by ASIC. He will serve a minimum of nine months.
Mr Sage, 47, was found guilty by a jury on 2 July 2007 on 10 charges of providing materially misleading oral statements and investment brochures to investors concerning his property development, Pacific Tower in Hawthorn, Victoria, between August 1999 and June 2002.
At the time, Mr Sage was the sole director of Merchant Pacific Developments Pty Ltd, which was responsible for the management and promotion of the Pacific Tower development in Hawthorn. Mr Sage was also an authorised representative and financial adviser for another of his companies, Merchant Pacific Investment Services Pty Ltd (Merchant Pacific Group) and promoted his investment projects using this client base.
Mr Sage also pleaded guilty to dishonestly using his position as a director to gain an advantage for himself, or another, in relation to selling off company property while his group of companies were under the control of external administrators. The company property was comprised of a stone sculpture valued in excess of $24,000 which Mr Sage passed off as his own and then used the sale proceeds for his own personal benefit.
The shortfall to creditors and investors of the Merchant Pacific Group (in liquidation) is in the vicinity of $14 million.
The Commonwealth Director of Public Prosecutions prosecuted the matter.
ASIC previously banned Mr Sage on 9 August 2005 from providing financial services for six years under Section 920A of the Corporations Act. He is currently prevented from working in the financial services industry until 9 August 2011. Editor's note: On 13 August 2009, the Commonwealth Director of Public Prosecutions lodged a Notice of Discontinuance and will not proceed with a re-trial of the ten charges.
Editors Note: On 26 June 2009, the Court of Appeal allowed an appeal lodged by Mr Sage who had appealed against his original conviction on 10 charges that formed part of the prosecution case brought by ASIC. Convictions on the 10 charges were quashed and the court left it open to the Commonwealth Director of Public Prosecutions to consider a re-trial of the matter.
The charge and subsequent conviction and sentence relating to Mr Sage dishonestly using his position as director to gain advantage for himself was not the subject of the appeal hearing, and was unaffected by the judgment.