This article is from the Australian Property Journal archive
INVESTORS in the illegal Co-Develop Group property schemes closed down back in December 2004 are still waiting for the bulk of their $28.5 million with many raising concerns that the the promoter of the schemes Leslie Raymond Freeman remains too close to the "handling" of the properties.
Of the $28.5 million invested in the illegal schemes around $17 million is still owed to investors, according to administrator at Korda Mentha. A forensic examination of where the $28.5 million invested in the schemes went has never been ordered.
The 10 Co-Develop schemes, run by Freeman and his wife Kylie, were shut down after being deemed by ASIC to be “misleading and deceptive or likely to mislead and deceive”.
The Freeman’s Co-Develop Group of companies offered investors promissory notes with returns of between 35% – 100%.
Freeman is now the major shareholder and managing director of ASX listed First Capital Group.
ASIC back in 2004 found Co-Develop operated an unregistered management investment schemes, carried on a financial services business without holding an Australian financial service license and offered securities without a current disclosure document.
Earlier this week, an investor said she was very concerned that Freeman was “still involved in the handling of the properties”.
The investor was concerned that Freeman’s Brisbane based First Capital was acting with New Zealand based group Gateway to Queensland Homes to market some of the properties in New Zealand. First Capital recently entered into a deal with Gateway to buy an unrelated residential development site for $14.9 million at Gulf Harbour near Wellington.
A director of the Gateway Group told Australian Property Journal on Tuesday that “we are just trying to sell the properties for them.” One of the Co-Develop developments being marketed by Gateway Group is Banksia Greens.
Korda Mentha’s Lachlan McIntosh confirmed to Australian Property Journal earlier this week that Freeman was “assisting” the administrator with the properties and has “offered to buy” several of the properties.
However, McIntosh confirmed that there was “no way” he would be selling any of the properties to Freeman.
McIntosh also confirmed that an employee of Freeman’s Randal Wilson was assisting in the marketing of the Queensland properties due to his “experience in the property market”.
McIntosh told Australian Property Journal that he would be finished with his work within the next six months, but he “highly doubted” that the 100 mums and dads investors caught up in the schemes would see anything near the amount they invested in their ill-fated Co-Develop Group.
A recent report in ASSET Magazine stated that First Capital had failed to settle on the full acquisition of Sydney based SMA funds manager Explorer Group.
ASSET reported that it had only so far paid for only a portion of the 30% holding by Explorer Group director Paul Bray.
A close examination of the share registry of First Capital shows that Leslie Raymond Freeman, and companies associated, is the major share holder in the group.
First Capital’s main business is offering debentures at a current rate of 9.95%.
First Capital’s share price has fallen from $1.16 in June last year to just 19 cents yesterday.
Australian Property Journal
