Investor funds with a Victorian based company operating an unlicensed financial services business have been preserved following Federal Court orders obtained by ASIC as part of a wider program to target and shut down online scams.

Goldsmith and Associates Pty Ltd (Goldsmiths) offer clients investments in various financial products including futures, options, contracts for difference and managed funds. Neither Goldsmith nor its director, David John Harkin, hold an Australian financial services (AFS) licence, the required licence to offer financial products or services in Australia.

Urgent orders were obtained on 13 December 2011 against Goldsmiths to restrain the company from carrying on a financial services business via its website, www//goldsmithandassociates.com, and from transferring or disposing of any funds in connection to the advertised financial services or products. ASIC also obtained orders that the website, and any related websites of Goldsmiths, be deactivated until a court determination.

The court orders obtained by ASIC also prevent Goldsmiths from:

• disposing of, destroying, amending, altering or parting with possession of their books and records relating to any financial services or products promoted, advertised, marketed or offered on its website; and

• taking or sending out of Australia any money, financial products or other property belonging to the company.

Proceedings returned to court on 21 December 2011 and orders were made adjourning the further hearing of the matter until 16 March 2012.

This action is part of ASIC’s focus on targeting online financial services scams and educating consumers about the importance of remaining vigilant when investing money - particularly after receiving cold calls.

Significant features of this type of scam are:

• victims are lured with promises of high returns and then subjected to pressure in order to induce them to hand over their money;

• the scam is supported by sophisticated internet technology including a website which purports to provide investors with real-time information in relation to their trading;

• victims are often initially cold called by a person purporting to survey their interest in investing generally; and

• when a person falls victim a first time, they are often called back and encouraged to invest in a more sophisticated trading strategy which requires even more money.

If you’re unexpectedly contacted by somebody trying to sell you a financial product, you should:

• Hang up the telephone;

• Check the ASIC registers accessible on www.asic.gov.au to see if the person or company selling the financial product is licensed or authorised to do so, if not then do not invest;

• Call the company back using the details on the ASIC register to verify its identity;

• If in any doubt, contact ASIC on phone 1300 300 630 or visit ASIC’s MoneySmart website (www.moneysmart.gov.au); and

• Remember if it is too good to be true, it is.

See also

• ASIC takes urgent action to preserve investor funds promoted on Cityindexmutual.com website (11-207AD)

• ASIC obtains court orders against Gold Coast-based investment scam (11-271AD)

• Notice to investors and creditors of Goldsmith & Associates Pty Ltd

Editor's note 3:

On 1 June 2012, proceedings before the Federal Court were adjourned to 27 July 2012 to allow for the further filing of evidence.

Editor's note 2:

On 3 April 2012 orders were made by Justice Middleton that the directions hearing on 13 April 2012 be vacated and the proceeding be listed for further hearing on 1 June 2012.

Editors Note 1:

On 16 March 2012, proceedings returned to the Federal Court and orders were made adjourning the further hearing of the matter until 13 April 2012.