ASIC probes alleged Pilbara Ponzi scheme
Investors from around the world who handed up to $190 million to a Pilbara property developer who promised mining boom returns were ensnared by what may be an “unlawful Ponzi scheme”, according to the corporate watchdog.
Macro Realty Developments boss Veronica Macpherson, who has an $80,000 BMW and a $177,000 Maserati in the garage at her Winthrop home, enjoyed a $US6750-a-month apartment in New York and offices in London’s Mayfair district, overlooking the Ritz Hotel, court documents say.
Documents lodged in the Federal Court by the Australian Securities and Investments Commission suggest Ms Macpherson has access to bank accounts scattered across the globe, including the US, Britain, Singapore and Luxembourg.
The documents include an allegation that Ms Macpherson spent more than $2 million over the past year on first-class travel for herself and staff of Macro Realty Developments.
In July, the Federal Court temporarily froze her assets, and those of a group of companies associated with Macro Realty Developments. Macro has spent five years touting investment in what was billed as the biggest residential development in the Pilbara, the Newman Estate.
The Weekend West can reveal the property scheme is being probed by ASIC, Singapore police and WA Police’s major fraud squad. They are investigating Ms Macpherson over allegations she has been running a Ponzi scheme — an investment structure in which returns to early punters are paid from cash stumped up by later investors.
The detailed allegations are revealed in documents filed by ASIC in support of its application to freeze Ms Macpherson’s assets and confiscate her passport.
Ms Macpherson appeared briefly in the Federal Court in late July to argue for the travel restriction to be lifted because not being able to do deals overseas would affect her business.
She argued for the retention of non-publication orders because public knowledge of the case would also affect her business.
She has not filed a defence as yet, and the matter does not return to court until December.
More than 1000 investors from Australia and overseas stumped up between $30,000 and $1.2 million each on the promise of 16 per cent returns on properties in the Pilbara, including the $100 million Newman Estate in the heart of iron ore country.
Ms Macpherson promoted the investment schemes in seminars in Singapore, Malaysia, the US, Britain and beyond, telling punters the investment was “arguably” safer than investing in the stock market.
They were promised monthly interest payments and the return of the capital when units built on the estates were sold, or when their properties were refinanced by major Australian banks. But documents filed by ASIC, in support of its Federal Court application for freezing orders, say investors are still owed as much as $180 million, including interest. They say only $10 million has been spent developing Newman Estate since Ms Macpherson first bought the underlying property for $11 million in 2011.
Of the six Pilbara developments touted by Macro, only one has been completed, ASIC alleges — a mixed commercial and residential development in Port Hedland that was sold at a loss.
Last September, the corporate watchdog intervened to put a stop to one of Ms Macpherson’s marketing efforts, a joint project with companies associated with property spruiker Jamie McIntyre. ASIC won Federal Court orders to halt the marketing of the “risk-free” and “no money down” promotion last year, and permanent orders closing the scheme in March.
About the same time, Macro Realty Developments stopped interest payments to its offshore investors, worth more than $1 million a month, according to ASIC allegations, and defaulted on a loan to a Hong Kong hedge fund that put up $35 million to back the Newman Estate development in 2013.
A month later, local representatives of the hedge fund, Prominent Investment Holdings (Australia) Ltd, appointed receivers to the company that held the bulk of the Newman Estate properties, 511 GTN Pty Ltd, seizing control of its assets.
The rest of the 1000 or so investors are awaiting the results of ASIC’s investigations, in the hope there will be something to salvage of their investment.