ASIC takes Linchpin to court over unlicensed investment schemes

In a statement, ASIC announced it had commenced proceedings against Linchpin Capital Group (the parent company of non-bank licensees Beacon Group and Libertas Financial Planning) and Endeavour Securities over two managed investment schemes operated by both businesses.

Both investment schemes listed by ASIC are called “Investport Income Opportunity Fund”, ASIC said.

ASIC said an investigation found Linchpin was operating the scheme “without holding an Australian Financial Services Licence as required by the Corporations Act” and used investor funds for its own purposes “without disclosing this use to investors”.

Additionally, the regulator said Endeavour Securities had entered into “related party transactions in contravention of the Corporations Act” and failed to properly disclose those transactions to investors, and that “monies invested in the schemes managed by Linchpin and Endeavour have been misapplied or misappropriated by Linchpin and Endeavour.”

ASIC intends to restrain the businesses from operating the schemes, prevent the businesses from “dealing with assets or investor funds”, appoint receivers and wind up both schemes, and “obtain declarations that Linchpin and Endeavour have acted in contravention of the Corporations Act.”

The issue is set to be heard in the Federal Court in Brisbane on 24 July, and ASIC’s investigation is ongoing.

Last month, ifa reported that Linchpin Capital intended to list on the ASX following a merger with fund manager AD Capital.