The Australian Securities and Investments Commission fears the man behind troubled efforts to redevelop Queensland’s cyclone-ravaged Dunk Island, James Mawhinney, may leave the country, a court has heard.
Asic also fears assets belonging to Mawhinney’s investment group, Mayfair 101, may be moved, counsel for the regulator, Jonathan Moore QC, told the federal court on Thursday.
The regulator has been investigating Mawhinney and Mayfair 101, which has taken at least $140m from investors, for several years and has launched legal action accusing them of making misleading and deceptive statements by comparing investments with the group to bank term deposits.
Former National party politician Julian McGauran, who invested $1m in Mayfair 101, has also made similar legal allegations.
In separate proceedings in the Victorian supreme court, allegations have been aired that potentially valuable shares in a British accounting software company were moved from the Mayfair 101 group to a company controlled by Mawhinney in tax haven the British Virgin Islands.
Receivers have been appointed over companies in the group after they failed to repay a loan to a feeder fund through which investors have pumped $85m.
Mawhinney has consistently denied any wrongdoing and told the Victorian court the BVI company in question, 101 Investments, was in fact part of the Mayfair 101 group.
Late last year he launched the Dunk Island redevelopment, which included an ambitious plan to lift property values in the entire region, by throwing a party on the island attended by Instagram influencers, singer Ricki-Lee Coulter and independent MP Bob Katter.
But the turmoil enveloping Mayfair 101 has left property owners in the region increasingly anxious that the company will not be able to deliver on promises to buy their land.
It is believed Asic applied to the federal court earlier this month for orders banning Mawhinney from leaving the country and freezing some assets.
Asic’s application was before the court on Thursday morning, but media were excluded from almost all of the hearing, which was held by videoconference.
“I have not been served with any order,” Mawhinney told Guardian Australia on Thursday evening.
Earlier, during the federal court hearing, Moore asked for the virtual courtroom to be closed because “there is a fear that if they [Mawhinney and companies associated with him] were given notice of it they might take steps to leave the jurisdiction”.
Asic also feared assets might be moved, he said.
Judge Stewart Anderson ordered everyone but Asic’s lawyers and employees to leave the videoconference.