12/11/2021 - 12:09

Claims against former PMM chief reach $2m

12/11/2021 - 12:09

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The former chief of financial advisory firm PMM Group is facing another lawsuit from an investor, taking the total of the claims against him to more than $2 million.

Claims against former PMM chief reach $2m
According to the writ, the lawsuit relates to a court action launched against Mr De Castro by Mr Rhodes regarding a written agreement he entered for the transfer of shares. Photo: Gabriel Oliveira

The former chief of financial advisory firm PMM Group is facing another lawsuit from an investor, taking the total of the claims against him to more than $2 million.

Perth businessman Damien Rhodes has launched a second legal action against his former financial adviser of three years, Gui De Castro, over his alleged failure to transfer $500,000 worth of shares in the entity behind Perth’s Ibis Hotel.

According to a writ lodged in the Supreme Court this week, the lawsuit relates to a court action launched against Mr De Castro by Mr Rhodes regarding a written agreement he entered with fellow investor Ross Cargeeg, PMM Group and Mr De Castro’s company My Two Boys.

The agreement allegedly stipulated that Mr De Castro would transfer Mr Rhodes $500,000 worth of units in Rehawk Property Group by August 11, but the units remain outstanding.

Mr Rhodes claims the agreement was the subject of an order by Supreme Court Justice Jenni Hill back in September, to which Mr De Castro has failed to adhere.

He also claims the failure to transfer the shares has resulted in him suffering loss, and he is now pursuing Mr Castro for damages.

The legal action comes just months after the Supreme Court granted a freezing order over a property linked to Mr De Castro to support another legal claim launched by Mr Rhodes and Mr Cargeeg.

The pair launched that action against PMM, Mr De Castro and My Two Boys over the alleged failure to transfer shares in global zircon producer PYX Resources, as per three oral agreements.

In giving evidence, Mr Rhodes alleged Mr De Castro had encouraged him to purchase shares in PYX Resources in September 2020, offering to transfer the shares from My Two Boys the following month.

Mr Rhodes claims he handed over several cheques totalling $470,000 for 1.175 million shares in PYX and was promised bonus shares worth $50,000 in Malaga automotive engineering company Sprintex Limited for finding more investors.

But Mr Rhodes said he had only received one-quarter of the PYX shares he paid for.

One of those investors was Mr Cargeeg, who purchased $110,000 worth of shares in PYX and was promised $30,000 in Sprintex Limited at no cost. 

According to the court document, he claims he has not received the shares.

Between March and June 2021, Mr Rhodes claims he exchanged several text messages with Mr De Castro in which the latter repeatedly promised to transfer the shares in PYX.

Mr Rhodes and Mr Cargeeg then launched legal action against the three parties in a bid to recover their alleged losses, seeking a freezing order over a Mount Pleasant property linked to Mr De Castro’s company.

Initially, the pair’s lawyers had sought a freezing order in the order of $1.05 million, but Justice Hill instead decided to fix the sum at $750,000.

That matter is expected to return to court next week.

Mr De Castro was also reportedly listed as a defendant in a Supreme Court action by basketballer Luc Longley's company Sandia regarding its $1 million investment in a stalled apartment development in North Perth.

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