A Brisbane property dealer has been sentenced to two-and-a-half years in prison for shaving off up to $2.2 million of invested assets to keep his business afloat.
Garry McDowell was convicted this week after pleading guilty to duping 11 people to invest in a doomed managed investment scheme.
He was director of QN Group, which was wound up by ASIC in 2004.
The company sold shares in residential property syndications in Brisbane and the Sunshine Coast.
When the properties were subsequently sold investors were told their money was going towards a corporate investment managed by Biri Investment Group in Vanuatu.
QN Group promised returns of 3 per cent compounded every month, while it still owned the property, and up to $20,000 a year guaranteed for six years after the sale.
The reality was QN Group was in dire straits financially and, according to ASIC, McDowell ignored advice from his accountant and continued to pour money into the business.
Despite the financial problems ASIC alleged McDowell continued to market the property syndications and engage staff.
QN Group's liquidator said that as much as $2.2 million that was to be put aside for the corporate investment scheme was used to cover previous expenses and current trading losses.
McDowell will serve a non parole period of nine months and will be subject to a good behaviour bond for three years.
"Those who deliberately mislead and deceive investors will be held accountable by the law and face significant jail terms," ASIC's executive director of enforcement Jan Redfern said.
