A former Adelaide financial adviser has been sentenced to 10 years imprisonment with a non-parole period of seven years for stealing around $4.88 million from his clients.
The District Court of South Australia convicted James Gibbs of theft and other dishonesty offences committed when he was director of James Gibbs Investments (JGI), following an ASIC investigation.
ASIC said Gibbs had previously pleaded guilty to all charges, which he committed against his clients between 20 August 2009 and 30 July 2016. At the time, he was a financial adviser, trusted by his clients to operate their self-managed superannuation accounts as well as open new accounts.
In some cases, ASIC found that Gibbs was given almost complete control of his clients’ affairs, which enabled him to conduct unauthorised transactions and that, once he controlled the accounts, he went on to steal their funds.
Gibbs used his clients’ funds for his own benefit, such as propping up his business, paying his own credit card debts, paying himself and staff a salary and for gambling.
Between 25 June 2012 and 30 July 2016, ASIC said Gibbs also created and used false documents, including bank documents and member statements in which he lied to his clients about the value of their investment portfolios to cover up his thefts.
“Clients need to be able to trust their financial advisers, and in this case, Mr Gibbs breached that trust,” said ASIC commissioner Danielle Press.
“ASIC’s investigation revealed that Mr Gibbs deliberately withheld information from clients to avoid detection. Financial advisers should always allow clients to access information about their own investments, and clients should be concerned if this is not occurring.”
In delivering the sentence, Judge Boylan found that Gibbs had built a relationship of trust with his clients, and then repaid their trust by systematically stealing their life savings and spending their money for his own purposes. He said Gibbs stole from the "easiest targets...who placed blind faith in him".
Judge Boylan also remarked that Gibbs’ behaviour was "despicable" and "cruel" and his offending involved a "gross breach of trust", and found that the offending fell at the higher end of the scale in terms of seriousness.
Gibbs is also automatically disqualified from managing a corporation for five years.
The matter was prosecuted by the Commonwealth Director of Public Prosecutions after an investigation and referral of a prosecution brief from ASIC.
The Court of Criminal Appeal has unanimously dismissed the appeal of a former ad...
In what Mayfair 101 has described as a ‘massive overreach’, ASIC has apparen...
A new survey of university financial planning departments indicates that less th...