Askk Investment Group Pty Ltd (ASKK)
Frequently Asked Questions – Information for investors
1. What steps has ASIC taken?
In December 2018, ASIC applied to the Federal Court of Australia seeking orders (amongst other things) restraining Askk from dealing with funds in its bank accounts in relation to a suspected land banking scheme, which ASIC alleges is an unregistered managed investment scheme (MIS) which Askk is operating in contravention of the law.
On 20 December 2018, the Court made interim orders freezing monies held in the bank accounts of Askk. Those orders have been varied since that time to allow the following payments to be made at the request of Askk:
- a total of up to $100,000 for payment of Askk’s legal costs in relation to the court action, the proposed transfer of the land at Lot 2, 615 Hume Highway, Beveridge (Land) to Askk as owner and a proposal to register the scheme being conducted in respect of the Land;
- a total of $44,789.97 for council rates in respect of the Land;
- $16,500 for the purposes of obtaining a sworn valuation of the Land;
- $8,525 for the purposes of Town Planning and Urban Design Services to represent Askk’s interests in relation to the finalization of the Beveridge North West Precinct Structure Plan; and
- a refund of a deposit of $100,000 (held in trust) paid by Venture Capital Holdings Group Pty Ltd as purchaser of the Land.
The freezing orders have been extended to the hearing of the matter on 23 and 24 October 2019.
ASIC has now applied to the Court to wind up Askk and also the MIS that it has operated in respect of the Land.
2. Why did ASIC issue the proceedings?
ASIC is concerned that Askk may be operating an unregistered MIS in breach of the law. ASIC is also concerned that Askk may be carrying on a financial services business in relation to the promotion and operation of an unregistered MIS without holding an Australian Financial Services License.
3. What are ASIC's concerns about Askk
Following our investigation, we are concerned that:
- Askk has been operating an unregistered MIS in contravention of the Corporations Act 2001 (Cth) (Corporations Act) by selling interests in the Land.
- Askk has raised over $10 million from investors by selling interests in the Land that it does not own.
- Askk has not kept proper records of the monies it has raised from investors and how that money has been spent.
- Askk is not licensed under the Corporations Act to raise money in this way from investors and has been operating in breach of the law.
- Askk may have made misrepresentations to investors during the course of promoting investment in the Land scheme.
ASIC says it is just and equitable that Askk and the scheme relating to the Land be wound up (that is, be brought to an end) for the reasons set out above. That is an issue which the Court will ultimately have to decide.
4. What is ASIC seeking in these court proceedings?
ASIC wants the Court to appoint independent persons (liquidators) to carry out the winding up of Askk and the scheme. As part of the winding up, the liquidators may investigate whether Askk is able to secure title to the Land and/or can recover investors’ money.
ASIC’s application is listed to be heard by the Federal Court of Australia on 23 and 24 October 2019.
5. Will investors get a refund?
ASIC is not seeking compensation or refunds for investors in this proceeding. However, if the Court orders the winding up of Askk and the scheme that it operates, the Court will appoint liquidators to Askk. The liquidator’s role will be to take over the management of Askk from the directors, investigate what assets Askk holds, realise any assets, and distribute proceeds (if any) to investors in accordance with the law.
ASIC understands that most of the investors' money has been paid to a company called Old Hume Pty Ltd (Old Hume) under a contract of sale signed by Askk to purchase the Land. Old Hume is not the registered proprietor of the Land but has itself entered into a contract of sale to buy the land from another person who is the registered proprietor.
If liquidators are appointed, they will look into the contract between Askk and Old Hume and the ownership of the Land.
The Court has also frozen the remaining monies in Askk’s bank accounts until ASIC’s application is heard and determined by the Court. As it is the Court that has frozen the bank accounts, it is only the Court that can authorize any payments from the bank accounts of Askk, including any refunds to investors.
6. What rights do investors have?
ASIC is unable to advise investors as to any rights that they might have in relation to ASIC’s application.
However, investors have the opportunity to apply to be represented in the Court proceedings.
If you want to be heard in Court, you must give a written notice to the Court as soon as possible.
If this is a step you may want to take then you should seek your own legal advice.
Investors may also want to seek independent legal and/or financial advice in relation to their investment with Askk and the scheme.
7. What will happen in the case?
The Court will hear arguments from ASIC, Askk and any investor that may seek to be heard.
ASIC or Askk might ask you to give evidence about what happened to you in this matter. The Court will listen to what you say in deciding what to do.
8. What do I have to do?
You do not have to give any evidence or write any documents in relation to this case if you do not want to do so, unless the Court tells you that you must. You do not have to assist either ASIC or Askk if you prefer not to.
If Askk (or its lawyers) ask you to sign any documents, we recommend that you obtain legal advice before you do.
9. What do I do if I have questions?
ASIC's guide on how a liquidation works may also assist you.
This proceeding is part of ASIC’s wider and ongoing investigation into land banking schemes.
Further information on land banking is located on ASIC’s MoneySmart website.
If you have difficulty speaking or understanding English, call the interpreting service, TIS National, on 131 450. They will call us so we can help you with your query.
If you still need more information you can contact Naomi Johnston on (03) 9280 3588 or or via email at email@example.com.
If you need legal advice you can consult a lawyer. If you think you may qualify for Legal Aid then please contact Victoria Legal Aid on 1300 792 387 or access information from their website at http://www.legalaid.vic.gov.au/.
Your local Community Legal Centre may also be able to provide you with assistance and you can search for your local centre at this address https://www.fclc.org.au/find_a_community_legal_centre.