- GARY Sempf thought by now he would be on the cusp of retirement. But his life plans have been shattered by the collapse of a Queensland olive grove investment scheme, which has cost more than 850 investors in excess of $39 million. The disaster has wiped out his life savings...
GARY Sempf thought by now he would be on the cusp of retirement.
But his life plans have been shattered by the collapse of a Queensland olive grove investment scheme, which has cost more than 850 investors in excess of $39 million.
The disaster has wiped out his life savings of $100,000. That was all that was left over after paying off the debt from his sand and gravel business once it sold about five years ago.
Worse still, the 53-year-old is now shackled with about $600,000 of debt from investment loans and has been forced to go back to work.
Sempf, who lives in Wondai, just north of Kingaroy, now toils operating a front end loader in a quarry in Monto, about three hours’ drive away. He gets up at 4am each work day and does not return home until 6pm.
“These people lead me to believe I could retire by 55 and now I’m in debt more than I’ve ever been in my life,” Sempf said last week.
“I’ve gone from having money to being in debt and that’s a lot for me, especially at my age. The whole point of working is to retire and now it’s gone.”
Sempf believes his only chance of salvaging something from the wreckage is a potential class action against one of Australia’s largest financial planning firms, Gold Coast-based Professional Investment Services, and other financial services licensees.
Law firm Slater & Gordon is seeking investors who lost money in the failed Brooklyn Park and Bonni-Foi olive grove schemes, which were based near Inglewood, about 150km southwest of Toowoomba.
Lawyer Ben Whitwell is among those spearheading the investigation into a possible action, which he alleges show that the schemes were “inappropriately recommended” to retail clients.
He says many investors have alleged they were wrongly told they would own the two olive groves, totalling about 450 ha, and the associated infrastructure as a fall back security.
Australian Green & Gold Ltd, the entity legally responsible for the olive grove investment schemes, unexpectedly announced plans to wind up the schemes in September 2011.
Replacement managers at the Huntley Group then sold the land and water assets for just $2.75 million, meaning investors would only claw back about 5 per cent of what they had tipped in.
It is expected Bonni-Foi investors will retrieve just $325 for every unit they had originally paid $7380 for, while Brooklyn Park punters can expect just 48 cents per share.
Even then, that meagre return is conditional on the buyer completing the contract by 2015 and also securing the water rights.
“The risks associated with investing in these schemes were tremendously higher than what they were advised,” Mr Whitwell alleged.
PIS and AG & G had one director in common and potential investors were encouraged to secure loans through a PIS-related entity, he claimed.
Mr Sempf alleges that he was incorrectly assured of a 10 per cent-plus return and that his investment enjoyed government backing which would provide for a bail out in case of its demise. He also found that he had to pay onerous maintenance costs and other fees.
PIS chief executive John de Zwart referred calls to a publicist, who could not be contacted.
The group, which has more than 500 advisers nationwide, suffered an $8.92 million net loss in the last financial year. That followed a $9.28 million loss in 2012.
Listed finance group Centrepoint Alliance acquired PIS in late 2010, the same year that the Australian Securities and Investments Commission revealed concerns about the company’s compliance with financial services laws.
PIS provided an enforceable undertaking to address the issues raised by ASIC, which said last July that an independent expert will monitor the company for nine months.
Centrepoint, which itself reported a $7.3 million net loss last year, acknowledged to investors earlier this year that PIS had provided “inadequate care” to client relationships.
AG & G director Peter Shakespeare declined to comment last week.
Huntley Group managing director John Knox said the schemes failed because the high Australian dollar meant it was cheaper for resellers to import olive oil from Spain and Italy. The cost of production also exceeded the prices which could be charged, he said.
For Sempf, the demise of his retirement nest egg means his dreams of buying a caravan have been dashed.
Burdened with heart problems and the obligation to look after his 7-year-old son, he believes a class action is the only way he will get justice. “That’s the only hope I’ve got left,” Sempf said.
Article source couriermail.com.auVN:F [1.9.22_1171]VN:F [1.9.22_1171]
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