Mawhinney strikes back: Former Mayfair 101 director accuses ASIC lawyers of “trial by media”

As we correctly predicted in our blog article just last week, the escalation of the fight between ASIC and former Mayfair 101 director James Mawhinney shows no sign of slowing any time soon.

To recap the state of play, ASIC announced on 16 November that it had filed an application for contempt of court against Mawhinney for failing to comply with a court order restraining him from raising funds via financial products for 20 years.

The problem, according to Mawhinney’s complaints lodged with legal profession regulators such as the Victorian Legal Services Board, is that ASIC’s lawyers did not verify that they had properly served the application on Mawhinney prior to the announcement.

According to an article published on the Independent Financial Adviser website, Mawhinney alleges that ASIC did not give his legal team access to 800 pages of application documents until a full business day after ASIC’s media release was published, and when he eventually was served, annexures were not provided.

Mawhinney’s lawyer, Rhys Roberts at Roberts Gray Lawyers, has accused ASIC of running a “trial by media”:

“It appears ASIC has rushed out to publish a media statement accusing our client of potentially criminal activity despite failing to provide us with over 800 pages of court filings and all relevant annexures to support their application.”

This type of conduct unfairly portrays our client and is detrimental to his public image.  It seems ASIC has opted for a trial by media rather than allowing the judicial system to perform its normal function.”

Since making the allegedly premature announcement, ASIC has not commented further on the matter.

ASIC and Mawhinney continue to fight on at least three further related fronts:

• Mawhinney has lodged an appeal against the 20-year ban, a hearing for which is pending;
• In civil penalty proceedings against Mawhinney and related entities, ASIC has sought $12million in penalties, and a court ruling following a penalty hearing is awaited; and
• Also last week, ASIC issued separate Federal Court proceedings against Mawhinney and companies in the Eleuthera Group for engaging in false, misleading or deceptive conduct by emailing consumers regarding investment options, terms and returns.

Again, we await further detail on all fronts of the battle of ASIC vs. Mawhinney.

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