media release (24-212MR)

Former Linchpin Capital director appeal dismissed by Full Federal Court

Published

The Full Federal Court has dismissed an appeal by Peter Daly, a former director of Linchpin Capital Group Ltd (in liquidation).

The matter, heard before Justice O’Callaghan, Justice McElwaine and Justice Jackman upheld the previous Federal Court ruling that Mr Daly:

  • was an officer of a responsible entity of a registered managed investment scheme,
  • breached his duties as an officer of a responsible entity of a registered managed investment scheme and did not act in the best interests of members, and
  • pay a $150,000 penalty and be banned from managing a corporation for five years.

ASIC Deputy Chair Sarah Court said, ‘Today’s outcome should act as a reminder to directors of responsible entities that operate managed investment schemes that they must act in the best interests of members.’

The Court ordered that the appeal should be dismissed. In his judgment, Justice Jackman said the penalty and period of disqualification ordered by the primary judge were well within the range of reasonable decisions, and one could not infer any misapplication of principle from that outcome. Justices O’Callaghan and McElwaine agreed.

Mr Daly filed an appeal to the Full Federal Court in February 2024 seeking that the orders made by the trial judge be set aside, or that the Full Federal Court exercise its discretion to impose a lesser disqualification of three years and a pecuniary penalty amount of $40,000.

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Judgment

Background

Endeavour was the responsible entity of a registered managed investment scheme called the Investport Income Opportunity Fund. Linchpin operated an unregistered managed investment scheme, which was also called the Investport Income Opportunity Fund. Both funds were placed into liquidation in 2019 (19-065MR).

Linchpin operated through various subsidiaries (including Endeavour) and provided a range of financial products and funds management and investment advisory services.

On 3 April 2023, the Federal Court found Endeavour directors Ian Williams, Paul Raftery, Paul Nielsen and Peter Daly (who was found to have acted as an officer of Endeavour) breached their duties as officers of a responsible entity of a registered managed investment scheme and did not act in the best interests of members (23-089MR).

On 10 January 2024, Justice Cheeseman made orders requiring that each of the directors pay ASIC’s litigation costs and pecuniary penalties and be banned from managing corporations (24-002MR).

In November 2019, ASIC banned Mr Williams, Mr Nielsen, Mr Daly and Mr Raftery from providing any financial services each for a period of five years (19-320MR and 20-122MR).

Media enquiries: Contact ASIC Media Unit