Creditors to see compensation from fallen Wollongong firm
Creditors of the Wollongong-based Tarrants Financial Consultants may yet see compensation for their losses, with a voluntary administrator appointed this week to decide the future of the beleaguered financial services firm.
According to an ASIC insolvency notice, Jamieson Louttit of Jamieson Louttit & Associates plans to hold meetings with the company's creditors over the next few weeks.
Tarrants Financial Consultants invested more than $23 million of clients' money into the Astarra Strategic Fund promoted by Trio Capital and Shawn Richard. The practice was placed in liquidation and its AFSL suspended in 2010 following the collapse of the investment scheme.
Speaking to ifa, Mr Louttit said a professional indemnity insurer had made a "significant" offer to the claimants and creditors of Tarrants Financial Consultants.
"There is a substantial amount owed to claimants and creditors and that's many millions of dollars. That's just simply the investment schemes that they've been involved in, such as Trio," he said.
"I think it [the offer] will be accepted. It's a significant amount of money available to creditors."
Mr Louittit said there are about 200 claimants who were clients of Tarrants Financial Consultants.
Following a first preliminary meeting, a second one will aim to decide whether creditors accept the insurer's offer or "the deed of company arrangement".
This meeting will also "decide the company's future", Mr Louttit said.
Earlier this year, the Federal Court dismissed an appeal by the director of Tarrants Financial Consultants, Ross Tarrant, who tried to reverse a seven-year ban order.
ASIC banned Mr Tarrant from providing financial services in 2011 for not complying with "various financial services laws". Later, the Administrative Appeals Tribunal affirmed ASIC's decision, after Mr Tarrant requested a review of the ban order.
Mr Tarrant then lodged an appeal with the Federal Court, claiming that the AAT's findings of "wilful breach" on his part were unsupported by evidence and indicated bias.
He also sought "a further order to be made by the court for damages brought by ASIC's factually incorrect press release nationally for irreversible damages to my professional and personal reputation", according to court documents.
The Federal Court ruled that while it was true the AAT found no evidence of dishonesty against him, "there can be no doubt that the AAT concluded Mr Tarrant's contraventions were serious for reasons which did not depend on any findings of dishonesty".
Former clients of Mr Tarrant burnt by the collapse of Trio have defended his name, telling ifa the former adviser had become a scapegoat and that responsibility should lie with other stakeholders.
Mr Tarrant is now the principal of Tarrants Accountants & Business Advisors in Wollongong.
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