In a statement, ASIC said Kenneth Grace had appeared in Tweed Heads Local Court on 12 April charged with eight counts of dishonest conduct and one count of operating a financial services business without a licence.
Mr Grace had been the director of Goldsky Asset Management Australia, Goldsky Global Access Fund and Goldsky Investments, as well as a US-based company, Goldsky Asset Management LLC.
ASIC said Mr Grace had raised money from investors in his local area of Kingscliff in the NSW North Coast as well as “high profile Australian sports people”.
“ASIC alleges between November 2014 and October 2018, Mr Grace represented to investors that their money would be invested in a managed fund which was operated by Goldsky and used for trading,” the regulator said.
“ASIC alleges Mr Grace did not apply the majority of investor monies to investment activity and those that were used for trading did not generate the profits that he represented to investors.
“ASIC further alleges that funds were used to pay returns and redemptions to existing investors and were also used to pay for the lifestyle expenses of Mr Grace and his immediate family.”
The charges carry a maximum sentence of 10 years’ imprisonment and two years’ imprisonment, respectively.
Mr Grace was granted conditional bail and the matter was adjourned to 7 June 2021.
Here I am in Kingscliff on the North Coast, 20 plus years and no client complaints, fully FASEA compliant, and yet I’m competing with TikTok, ASIC levies, turning people away due to red tape, unable to get new clients that are viable and thinking of tossing it all in..
and yet on one hand we’ve got ASIC actively encouraging people to go to this guy, by making it easy for him to operate, because they’ve made it too hard for advisers like me to run a business. Whilst he was out chatting scamming new clients, I’ve been buried in red tape back at the office. Good job ASIC.
How are people being drawn to “shonks and scams like this one”? Regulation might be over the top but regulated people at least have the credentials to prove they are licensed. If people are drawn to shonks its likely because they are greedy and responding to the outrageous returns being offered. This is not the fault of either Choice or ASIC because they clearly say to consumers that if it sounds too good to be true then it probably is. They could however do more to promote the benefits of professional advice. There will, sadly, always be people like Mr. Grace.
But ASIC and Choice don’t promote the benefits of professional advice. They actively disparage it.
Imagine if the Health Department came out and said “Due to the malpractice of some doctors in the past, no doctor can ever be trusted, so you should be getting your health advice from other sources”. Of course consumers will then resort to quack remedies and miracle pills that sound too good to be true.
This is effectively what ASIC and Choice have done in financial services.
Get used to it folks. With regulatory overkill of professional licensed advice, naive consumers are being increasingly drawn to shonks and scams like this one.
ASIC and Choice should be ashamed for creating an environment that makes things worse for most consumers.