ASIC has commenced civil proceedings in the Supreme Court of Queensland against Dr Roger Gareth Munro and Mrs Kathleen Susan Munro. ASIC is seeking declarations and other orders in relation to their conduct, which ASIC alleges would constitute carrying on a financial services business in Australia without an Australian Financial Services (AFS) licence. 

ASIC alleges that since August 2011, Dr Munro has, with the assistance of Mrs Munro, operated an unlicensed financial services business in Australia. ASIC also alleges that:

• Dr Munro continues to tell investors he is generating profits from trading, when documents obtained by ASIC identify that Dr Munro appears to have lost money from trading in Australia.
• Dr Munro has raised over $1.5 million from investors, friends and family for trading purposes, but has failed to keep any, or produce any, books or records to ASIC in relation to this fundraising.
• a significant portion of funds which have been provided to Dr Munro for trading  have ultimately been transferred to a brokerage account in Mrs Munro's name, for trading – traded funds are then redeemed and transferred into another bank account held by Mrs Munro. 

ASIC has sought a declaration that Dr Munro has been carrying on a financial services business without holding an AFS licence. ASIC has also sought a declaration that Mrs Munro has either been carrying on a financial services business without holding an AFS licence, or aided or abetted Dr Munro to do so.

ASIC has sought orders which:

• restrain Dr Munro and Mrs Munro from carrying on a financial services business in Australia, without holding an AFS  licence
• restrain Dr Munro and Mrs Munro from disposing of or dealing with investor funds
• restrain Dr Munro from operating certain bank accounts and trading accounts
• restrain Mrs Munro from providing any aid or assistance to Dr Munro in carrying on a financial service business
• restrain Mrs Munro from allowing Dr Munro to use or operate certain bank accounts in her name
• direct Dr Munro to provide ASIC with information about his fundraising activities and the location of investor funds.

ASIC's application is listed in the Brisbane Supreme Court on 7 August 2015.

Editor's note 1:

ASIC's application was heard by the Supreme Court of Queensland on 7 August 2015 where ASIC sought a number of interim orders in relation to Dr Roger Munro and Mrs Kathleen Munro.

There was no attendance at Court by Dr Munro, Mrs Murno, or a legal representative for Dr Munro or Mrs Murno.

The Court made all of the interim orders sought, which:

• restrain Dr Munro and Mrs Munro from carrying on a financial services business in Australia, without holding an AFS licence
• restrain Dr Munro and Mrs Munro from disposing of or dealing with investor funds
• restrain Dr Munro from operating certain bank accounts and trading accounts
• restrain Mrs Munro from providing any aid or assistance to Dr Munro in carrying on a financial service business
• restrain Mrs Munro from allowing Dr Munro to use or operate certain bank accounts in her name
• direct Dr Munro to provide ASIC with information about his fundraising activities and the location of investor funds.

This matter has been adjourned to 27 August 2015.

Editor's note 2:

On 27 August 2015, a directions hearing was listed for 2 October 2015. A trial date was set down for 5 November 2015.

Editor's note 3:

On 2 October 2015, directions were made by the Court to progress to the trial. Dr and Mrs Munro did not attend the hearing.

Editor's note 4:

On 5 November 2015, the hearing was adjourned to Thursday 12 November and Friday 13 November 2015.

Editor's note 5:

On 12 and 13 November 2015, the trial of the proceeding against Dr and Mrs Munro was heard in the Brisbane Supreme Court.

On the first day of the trial, evidence was presented by ASIC and Dr and Mrs Munro. On the second day of the trial, Dr and Mrs Munro consented to declarations being made by the Court that Dr and Mrs Munro have both contravened section 911A of the Corporations Act by carrying on a financial services business in this jurisdiction without holding an Australian financial services licence. Dr and Mrs Munro have also consented to certain injunctive relief sought by ASIC to ensure that the Munro's cannot continue to carry on the financial services business without an Australian financial services licence. That injunctive relief will not prevent the Munros from returning investor funds to persons who have given them money for the purposes of investment via their unlicenced financial services business.

Final orders in the proceeding have not yet been made, awaiting the delivery of written reasons as to why the Court is satisfied in exercising its discretion to provide the declaratory relief sought by ASIC and as to what order (if any) should be made as to ASIC's claim that Dr and Mrs Munro pay its costs of the proceeding.

Editor's note 6:

The matter was mentioned on 2 December 2015 in the Brisbane Supreme Court. Neither respondent appeared in court. Justice Flanagan gave the respondents until the 18 December 2015 to file any further submissions, following which the Court can complete the judgement.

Editor's note 7:

On 3 February 2016, the Supreme Court of Queensland has found that Dr Roger Munro breached the Corporations Act by carrying on a financial services business in Australia without holding an Australian financial services AFS licence and has permanently restrained him from doing so. (refer: 16-023MR)