Opes Prime - Criminal Charges

Criminal Charges

Laurie Emini, Julian Smith and a third director, Anthony Blumberg were each charged with four offences in late 2009 in relation to the collapse of the group. In bringing these charges ASIC alleged that shortly before Opes Prime collapsed, the directors signed financial documentation with ANZ Bank to obtain a term loan for Opes Prime Stockbroking Limited (OPSL) and Opes Prime Group Limited (OPGL) and pledged the companies' assets as security to meet the obligations of a third company, Leveraged Capital Pty Ltd. ASIC alleged that in doing so, the directors were intentionally dishonest and failed to exercise their powers and discharge their duties in good faith in the best interests of OPGL and OPSL. It was further alleged that Messrs Emini, Smith and Blumberg dishonestly used their position as directors of OPGL and OPSL with the intention of directly or indirectly gaining an advantage for themselves or for someone else.

Leveraged Capital Pty Ltd was a company owned by Emini and Smith. It was placed into administration and receivership at the same time as the Opes Prime companies.

A third company at the centre of the saga, Hawkswood Pty Ltd, was owned equally by Emini, Smith and Blumberg. It was ostensibly involved in venture capital financing. It too was placed into administration and receivership at the same time as the Opes Prime companies.

A fourth company, Riqueza Holdings, also features frequently in commentary on Opes Prime. Riqueza Holdings was a company registered in the British Virgin Islands. The company was owned by Jay Moghe who managed Opes Prime's Singapore office, but was apparently controlled by the three accused. (See below.)

On 28 May 2010 ASIC announced that a further 22 charges had been laid against Laurie Emini for breaching his duties as a director of Opes Prime Stockbroking Ltd and Leveraged Capital Pty Ltd. ASIC alleged that on a number of occasions between July 2006 and February 2008, Mr Emini caused the false recording of securities in the records of OPSL and Leveraged Capital so that securities were recorded as being held by more than one client at the same time. The result of this false recording was that the records of OPSL and Leveraged Capital were not a true reflection of the state of those companies’ securities holdings and consequently, their respective financial positions. The value of these securities was in excess of $50 million. ASIC further alleged that in causing the false recordings to be made, Mr Emini was intentionally dishonest and failed to exercise and discharge his duties in good faith in the best interests of OPSL and Leveraged Capital. Ten of the charges brought by ASIC allege that Mr Emini used his position with Opes "dishonestly with the intention of directly gaining an advantage for yourself or someone else".

There was a significant delay in bringing the three accused to trial because of the length of time prosecutors believed that a committal hearing would require - some three to four weeks. The committal hearing was set for 28 February 2011, but some further developments in the case occurred on 2 February 2011. On that day, Emini was declared bankrupt owing some $6.8 million to Opes Prime as well as sizeable sums to others including his lawyers. At the same time, Smith was granted legal aid with his defence to be funded by taxpayers.