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Opes Prime
Opes Prime Group Limited was an Australian securities lending and stockbroking firm which suffered a dramatic collapse in 2008.
The company was founded in 2003 by Laurie Emini and Julian Smith. Emini, an Albanian emigrant to Australia, had worked for the Australia & New Zealand Banking Group (ANZ) until he was retrenched in 1997, and began share trading from his home. Smith, a British national, had emigrated to Australia in 1993, and ran the securities and investments division of the stock brokerage firm Ord Minnett. By 2008, the company had offices in Melbourne, Sydney and Singapore and employed about 80 people.
The company's downfall was revealed on 28 March 2008 when the Australian Securities & Investments Commission (ASIC) announced it was launching an investigation into Opes Prime Stockbroking, and that the company had gone into receivership the previous day, with Deloitte Touche Tohmatsu appointed as receivers by the ANZ Bank immediately after the company had appointed Ferrier Hodgson as administrators. Opes Prime's secured debt was believed[by whom?] to be over A$1 billion, with its major secured creditors including the ANZ Bank (owed around $650 million), and Merrill Lynch.
Melbourne underworld figure Mick Gatto made headlines when he travelled to Singapore on behalf of an anonymous group of investors in an attempt to retrieve their money. Gatto however returned to Melbourne saying that the Singapore Directors and staff were hardly to blame but were rather "victims".[citation needed]
On 15 October 2008, the Opes Prime creditors voted to place the companies of the group into liquidation with the administrator Ferrier Hodgson being appointed as liquidator. Ferrier Hodgson then tenaciously pursued ANZ Bank and Merrill Lynch for restitution in relation to their dealings with the companies immediately prior to and in receivership. This effort was supported by ASIC. The actions of ASIC and Ferrier Hodgson resulted in a settlement which included the payment of compensation and enforceable undertakings by ANZ Bank.[citation needed]
These settlements allowed the liquidators to propose a scheme of arrangement which was approved by the court on 4 August 2009. The scheme of arrangement has allowed the liquidators to repay creditors some 37c in the dollar of the sums they were owed, but prevents the creditors from taking any further actions against ANZ Bank.[citation needed]
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.
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Opes Prime
Opes Prime Group Limited was an Australian securities lending and stockbroking firm which suffered a dramatic collapse in 2008.
The company was founded in 2003 by Laurie Emini and Julian Smith. Emini, an Albanian emigrant to Australia, had worked for the Australia & New Zealand Banking Group (ANZ) until he was retrenched in 1997, and began share trading from his home. Smith, a British national, had emigrated to Australia in 1993, and ran the securities and investments division of the stock brokerage firm Ord Minnett. By 2008, the company had offices in Melbourne, Sydney and Singapore and employed about 80 people.
The company's downfall was revealed on 28 March 2008 when the Australian Securities & Investments Commission (ASIC) announced it was launching an investigation into Opes Prime Stockbroking, and that the company had gone into receivership the previous day, with Deloitte Touche Tohmatsu appointed as receivers by the ANZ Bank immediately after the company had appointed Ferrier Hodgson as administrators. Opes Prime's secured debt was believed[by whom?] to be over A$1 billion, with its major secured creditors including the ANZ Bank (owed around $650 million), and Merrill Lynch.
Melbourne underworld figure Mick Gatto made headlines when he travelled to Singapore on behalf of an anonymous group of investors in an attempt to retrieve their money. Gatto however returned to Melbourne saying that the Singapore Directors and staff were hardly to blame but were rather "victims".[citation needed]
On 15 October 2008, the Opes Prime creditors voted to place the companies of the group into liquidation with the administrator Ferrier Hodgson being appointed as liquidator. Ferrier Hodgson then tenaciously pursued ANZ Bank and Merrill Lynch for restitution in relation to their dealings with the companies immediately prior to and in receivership. This effort was supported by ASIC. The actions of ASIC and Ferrier Hodgson resulted in a settlement which included the payment of compensation and enforceable undertakings by ANZ Bank.[citation needed]
These settlements allowed the liquidators to propose a scheme of arrangement which was approved by the court on 4 August 2009. The scheme of arrangement has allowed the liquidators to repay creditors some 37c in the dollar of the sums they were owed, but prevents the creditors from taking any further actions against ANZ Bank.[citation needed]
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.