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Thursday 12 December 2019

19-351MR ASIC takes steps to wind up Chris Marco’s alleged unregistered managed investment scheme

ASIC has filed an application seeking leave to apply for further orders in the Federal Court in Western Australia to wind up an alleged unregistered managed investment scheme, and a related company, operated by Mr Marco. ASIC is also seeking declarations that Mr Marco failed to hold an Australian Financial Services Licence (AFSL) whilst carrying on a financial services business.

The application is filed in the matter currently against:

  • Mr Chris Marco, who traded as Coastline Group;
  • AMS Holdings (WA) Pty Ltd (AMS); and
  • AMS Holdings in its capacity as Trustee of AMS Holdings Trust.

ASIC alleges Mr Marco has been raising funds from investors since January 2010, in contravention of section 911A (the requirement to hold an AFSL) and section 601ED (the requirement to register a scheme meeting certain criteria) of the Corporations Act 2001 (Cth) and it is just and equitable that the scheme and AMS be wound up by the Court.

ASIC is seeking interim orders to appoint a receiver over Mr Marco’s and AMS’s assets and, by way of final relief, orders to wind up the scheme and AMS.

In total, Mr Marco received approximately $240 million from 132 investors. Mr Marco provided investors with a guarantee that their principal investment was secured. ASIC will allege that there is a very significant shortfall in the assets available to operate the scheme into the future.

ASIC’s investigation into other aspects of the alleged conduct of Mr Marco and AMS is ongoing.

The first case management hearing is listed for 17 December 2019.

Background

On 1 November 2018, ASIC obtained asset preservation orders over the assets held by Mr Marco and AMS. Since the orders were made, Mr Marco has made numerous applications to vary the asset preservation orders permitting Mr Marco to pay expenses incurred by AMS.  

ASIC provides updates on its ongoing investigation into the conduct of Mr Marco and AMS on the ASIC website.

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Interlocutory Process

Editor’s note:

The interlocutory application has been tentatively listed for a two-day hearing commencing on Monday, 16 March 2020.

Editor's note 2: 

At the start of the hearing on 16 March 2020, Justice McKerracher advised everyone who was present that, due to the coronavirus, the hearing would be proceeding on the papers and not in person as originally scheduled.  The hearing was adjourned shortly after that.  Justice McKerracher will hand down his decision at a future date.

Editor's note 3:

On 24 July 2020, the interim receivers filed their report with the Court. On 7 August 2020, the Court made orders requiring the interim receivers to provide a redacted version of their report to investors. ASIC understands the redacted report has been provided to investors.   

The Federal Court of Australia has listed ASIC’s application for final orders to wind up an alleged unregistered managed investment scheme operated by Mr Marco for a hearing on 28 and 29 October 2020, commencing at 10:15am (AWST) on both days.

Last updated: 30/03/2021 09:23