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Tuesday 23 August 2016

16-264MR Federal Court upholds ASIC's banning of finance broker

Former Victorian finance broker Rudy Noel Frugtniet's appeal against his permanent banning from engaging in credit activities has been dismissed by the Federal Court of Australia.

ASIC permanently banned Mr Frugtniet, a former director of Unique Mortgage Services Pty Ltd (UMS), in July 2014 after it was found he provided misleading information and a lack of full disclosure on a credit licence application [refer: 14-163MR].

Mr Frugtniet appealed ASIC's decision to the Administrative Appeals Tribunal (AAT) in July 2014. On 6 March 2015, the AAT upheld ASIC's decision to permanently ban Mr Frugtniet from engaging in credit activities owing to his 'dishonest conduct over a prolonged period; his failure to show any real awareness of the nature, extent and significance of that conduct; and a demonstrated disregard for compliance with regulatory requirements' [refer: 15-049MR].

Mr Frugtniet filed an application in the Federal Court for a review of the AAT's decision on 7 April 2015. A hearing was held on 3 December 2015, where Mr Frugtniet represented himself.

Deputy Chairman Peter Kell said, 'This decision highlights the duty of full disclosure of those wanting to engage in credit activities. ASIC will take all necessary steps to ensure those who engage in credit activities do so efficiently, honestly and fairly.'

Download the Federal Court's decision

Editor's note:

On 12 October 2017, the Full Federal Court dismissed Mr Frugtniet's appeal (refer: 17-354MR).

Editor's note 2:

On 17 August 2018, Mr Frugtniet was granted leave to appeal to the High Court.

On 15 May 2019, High Court of Australia upheld the appeal (refer 19-116MR).

Editor's note 3:

Mr Frugtniet’s application for review of ASIC’s decision was remitted to the AAT and heard between 17 February 2020 and 3 August 2020. The AAT’s decision is reserved.

Last updated: 30/03/2021 09:23