Sydney businesswoman Melissa Caddick has left investors almost $24 million out of pocket – more than previously thought – the Federal Court has heard.
Ms Caddick’s decomposed foot was found washed up on a remote beach on the NSW South Coast three months after she disappeared from her Dover Heights home in Sydney’s eastern suburbs.
The 49-year-old went missing on November 12, 2020 – the day after her house was raided as part of an Australian Securities and Investments Commission investigation into her finances and her financial services company Maliver.
At a hearing on Tuesday to recoup some of the money Ms Caddick’s clients are owed, the barrister for ASIC, Farid Assad SC, said her financial services business, Maliver, was successful and clients extolled her virtues.
Ms Caddick built up a sizeable and loyal client base, and befitting of a successful businesswoman were the trappings of wealth, real estate in Sydney’s eastern suburbs, luxury motor vehicles, designer clothing and jewellery,” he said.
“Unfortunately Ms Caddick’s success and the financial services business were all a facade.
“The financial services business was a front for Ms Caddick’s ponzi scheme.”
Mr Assad said the facade continued for eight years from 2012 to 2020 and involved a pattern.
The court heard Ms Caddick would convince investors of her “prowess in creating wealth”, interview them to ascertain their income, then advise them of an investment strategy that involved her setting up an account with CommSec – a well-known online share trading facility.
It heard she also convinced about half of her clients to establish self-managed superannuation funds.
“Investors trusting Ms Caddick would transfer funds to her and later to her alter-ego Maliver,” Mr Assaf said.
The court heard instead of using clients money for investments and shares, Ms Caddick misappropriated it for herself.
“Ms Caddick would convince clients she established a CommSec account on their behalf … and to maintain the deception, she sent investors fictitious portfolio evaluations,” Mr Assaf said.
“ASIC has managed to obtain many hundreds of pages of these fictitious portfolio evaluations.
“Not one of those documents is a genuine portfolio evaluation from CommSec.”
The court heard Ms Caddick convinced about 72 investors to provide her with $32 million.
Some of the money has been returned, but there was a “deficiency” of between $15 million and $23.7 million.
The court has previously heard the amount was up to $23 million.
Referring to the large volume of evidence in the case, Justice Brigitte Markovic said that it would take even a speed reader up to four weeks to get through some of it.
Before the remains were found a warrant was issued for her arrest for 38 breaches of the corporations act.
The two-day hearing in Sydney continues.