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A former financial adviser has been sentenced to six years in jail for misappropriating $1.9 million of client funds, including funds invested through SMSFs.
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Former financial adviser’s ‘Ponzi scheme’ ends with 6-year jail term
04 August 2020
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8 minute read
Acting Judge Woods of the Downing Centre District Court has sentenced Graeme Walter Miller, a former financial adviser and director of Australian financial services licensee CFS Private Wealth Pty Ltd, to six years’ imprisonment, to be eligible for parole after serving four years.
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Mr Miller had earlier pleaded guilty to six counts of engaging in dishonest conduct in the course of carrying on a financial services business between July 2013 and April 2017, misappropriating $1.865 million of client funds.
The charges relate to 10 clients from whom Mr Miller encouraged or facilitated the transfer of between $50,000 and $950,000 by way of an investment for the benefit of the client.
Four counts relate to funds invested with Mr Miller through self-managed superannuation funds held by the clients.
Mr Miller then transferred $987,000 to bank accounts and credit cards held by him and his family members; used $318,5000 to pay dividends, interest or return of capital to other clients in relation to their investments with Mr Miller; and used $135,000 to pay for other personal and business expenses.
A further $27,000 was withdrawn in cash or transferred overseas.
Judge Woods made reparation orders of approximately $1.777 million in favour of the 10 clients who were the subject of the charges against Mr Miller.
In sentencing Mr Miller, Judge Woods described Mr Miller’s conduct as a “Ponzi scheme” involving a “significant breach of trust” and a “cruel and deceitful betrayal inevitably leading to financial disaster”.
Following the sentencing, ASIC deputy chair Daniel Crennan said Mr Miller has been found to have systematically breached the trust of his clients over a long period, resulting in significant losses.
“As a financial adviser, Mr Miller ought to have protected the interests of his clients. His sentencing should send a strong message that such conduct will lead to individuals involved being brought before the court to face criminal charges,” Mr Crennan said.
Mr Miller was previously banned from providing financial services for 25 years and disqualified from managing corporations for three years.
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