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ASIC obtains freezing orders against brokerage

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The Australian Securities and Investments Commission (ASIC) has obtained urgent interim orders in the Federal Court against Alliance Insurance Broking Services (AIBS) and its sole director Renato De Maria.

The corporate regulator says in a statement released today that in support of its application for the orders it “alleged that Mr De Maria caused substantial client money held by AIBS to be improperly paid into a bank account for his own personal benefit”.

AIBS has published a statement here disputing the accuracy of ASIC's comments.

ASIC says the orders restrain AIBS and Mr De Maria (the defendants) from removing or permitting funds to be removed from five AIBS bank accounts and one personal account held by Mr De Maria, and from disposing of and/or diminishing the value of any property or assets held by, or in the names of, the defendants.

“The defendants consented to the interim asset freezing orders, which allowed AIBS to otherwise continue its ordinary business,” ASIC says.

ASIC says on May 26 it filed further proceedings in the Federal Court seeking the appointment of provisional liquidators to AIBS. ASIC’s application was opposed by AIBS.

The statement says on June 30 ASIC and AIBS agreed to orders, which were endorsed by the Court.

The orders require AIBS to:

- appoint an independent sales agent to sell the business operated by AIBS by either 30 August 2021 or a different date set by the Court;

- appoint an Investigative Accountant to inquire into and report on AIBS’s affairs to the Court and ASIC, and to monitor transactions made by AIBS on all of its bank accounts;

- instruct the Investigative Accountant to provide a report to the Court that investigates AIBS’s assets and liabilities, reconciles client money and other business accounts to identify improper activity, identifies affected clients and insurers, and identifies suspected contraventions of the Corporations Act by AIBS, its director, its employees and/or its agents; and

- receive an injection of $5 million into its trust account, by way of a personal loan from Lygon Finance Pty Ltd to Mr De Maria, to meet its ongoing financial commitments.

Registered liquidator John Lindholm of KPMG has been appointed by the Court as the Investigative Accountant.

As a result of the orders, the proceedings filed by ASIC on May 26 have been adjourned.

“However, if AIBS fails to comply with any part of the Court orders, ASIC can recommence its proceedings to seek the appointment of a provisional liquidator,” ASIC said.

“ASIC application for these orders was made to preserve assets for the benefit and protection of AIBS’s insured clients and insurance providers.

“Any AIBS clients who have concerns about their policies should contact their insurance provider directly.”

ASIC says its investigation into the defendants is ongoing.

“It does not relate to or affect other financial advisers or corporate authorised representatives who may also provide insurance services offered by AIBS.”

AIBS says on its website that it is "part of the Steadfast Group".

A Steadfast spokeswoman told insuranceNEWS.com.au that while AIBS is part of the Steadfast network, it is not an equity member of the Steadfast Group.

“As the matter is before the Courts we are not able to provide any further comment at this stage,” she said.