Businesswoman Melissa Caddick disappeared from her Sydney mansion owing millions to investors. Photo / News Corp AustraliaMissing con artist Melissa Caddick allegedly used her “sham” investment firm to pocket more than $30 million from 72 trusting investors over the course of eight years, a court has heard.
Caddick, whose decomposed foot washed up on a NSW beach this year, is believed dead but the Australian Securities and Investments Commission’s fight to claw back the tens of millions it says she stole continues in court.
A Federal Court hearing today was told there was a gap of up to A$23.7m ($25.5m) between the value of Caddick’s assets, and the assets of her business Maliver, and what is owed to her distraught creditors.
ASIC’s barrister, Farid Assaf SC, said the 49-year-old charmed her alleged victims through the boutique company, which appeared successful, between October 2012 and November 2020.
She also fooled people by flaunting the “trappings of wealth” including luxury cars and designer clothes, he said.
But the “only source” of A$30.195m ($32.46m) in funds deposited into the 37 bank accounts that she operated during that period was her investors’, apart from “limited exceptions”, Assaf said.
Assaf said in 2012 investors pumped A$305,000 ($327.873) into Caddick’s scheme and the amount of cash increased “quite dramatically” over the years, rising A$7.7m ($8.28m) during 2020.
“Unfortunately, Ms Caddick’s success and (that of) the financial services business were all a facade,” he said.
“And, in our submission, (Maliver) was an elaborate front for Ms Caddick’s Ponzi scheme.”
Caddick disappeared from her sprawling eastern suburbs home on November 12, just hours after federal police raided the Dover Heights property.
She left in her running gear but took nothing with her and despite a high-profile and extensive search, investigators found no trace of her for months.
That was until the grim discovery of her decomposed foot inside an Asics running shoe on Bournda beach on the NSW south coast in February. The rest of her body has not been uncovered.
Police believe her remains washed ashore months after she threw herself off the cliffs at Dover Heights soon after leaving her home.
Assaf told the court Caddick would convince potential investors of her financial prowess and advise them to set up CommSec accounts and self-managed super funds, which she would oversee.
The investors would then transfer funds to Caddick who was operating without a financial services licence and to her “alter ego”, Maliver, for her to manage.
To maintain the scheme she would then fabricate portfolio evaluation statements purported to be from CommSec and carrying the bank’s letterhead and a client account number.
Assaf said ASIC had recovered hundreds of such documents but “not one is a genuine portfolio evaluation statement from CommSec”.
“Unfortunately, Ms Caddick would misappropriate those funds for her own personal use,” he said.
The court heard some of those funds were used to pay for a luxurious lifestyle and to purchase “rural property, motor vehicles, artworks and jewellery”.
Yet a valuation of Caddick’s remaining assets, which cannot be published, has found a “significant deficiency” in what is owed to investors, ranging “from about A$15 to A$23.7 million” ($16.12 to 25.48m).
Some investors did have their capital returned, though they were few in number, Assaf said.
“They were simply funds that were arbitrarily refunded by Ms Caddick to particular investors,” he said.
The court heard a total of just over A$8.5m ($9.14m) was repaid to creditors during the eight-year scheme, leaving a gap of A$23m ($24.72m).
Most of the funds were sent to Maliver, but ASIC argues in reality it all went to Caddick and not the company Assaf described as “a sham”.
“Because of the fraudulent nature of this scheme it was Ms Caddick who was the controlling mind of Maliver and therefore we invite the court to draw no distinction between the activities of Ms Caddick and Maliver,” he said.
The court heard Caddick’s parents, Edward and Barbara Grimley, were now interested parties in the court proceedings to carve up their daughter’s assets.
The hearing continues before Justice Brigitte Markovic.
– NCA NewsWire

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