Court lifts Ascent decision suppression

The Federal Court has lifted the suppression over its judgment against Michael Dunjey that found his company Ascent having liabilities of $117 million and likely to have operated a Ponzi scheme.

In April, the Federal Court of Australia ordered Ascent Investment and Coaching be wound up, appointing Deloitte partners Matthew Donnelly and Sean Holmes as liquidators to the company.

Mr Dunjey requested a suppression order over the April judgment, claiming it could interfere with any criminal prosecution that might arise, with Federal Court judge Michael Feutrill issuing an interim non-publication order.

However, interested parties were succesful in their application to lift the non-publication order and Justice Feutrill’s decision was published today.

“Based on the evidence concerning the flow of funds through Ascent's bank accounts, it is likely that Ascent used the deposits of later contributors to pay 'interest' and 'capital' to earlier contributors,” he said in the April judgment.

“That is, it very likely that Mr Dunjey and Ascent operated a 'Ponzi' scheme.”

The Australian Securities and Investments Commission launched an investigation into Ascent and Mr Dunjey, alleging there had been misrepresentations made to investors between July 2012 and December 2021.

The corporate watchdog claimed there had been an unregistered management investment scheme with Ascent owing millions of dollars to its clients.

ASIC pushed for Ascent to be wound up and its application was granted by the Federal Court in April.

According to the judgment, Ascent had liabilities of more than $117 million with the majority of them recorded as client loan agreements on the 2020 financial statements and tax return for Ascent Trust.

"In the tax return, Ascent is recorded as the beneficiary of the trust estate to which the whole of the trust income was distributed," Justice Feutrill said in the judgment.

The judge said he was satisfied ASIC had provided evidence required for the serious nature of allegations against Ascent.

“It is also likely that the vast majority of the funds that contributors deposited into an Ascent bank account have not been used for genuine investment activities of the kind represented to contributors,” he said.

“It is likely that a significant proportion of the funds have been used by Mr Dunjey or entities related to him to acquire personal and real property for the benefit of Mr Dunjey and (or) those entities.

“Further, that any returns from that property has not been used to finance payments of 'interest' or 'capital' to contributors.

“The contributors executed the loan agreements and deposited funds into bank accounts controlled or held by Ascent and Mr Dunjey on the understanding that they were acquiring rights to benefit from what was represented to them as a lucrative investment scheme managed by Mr Dunjey who was a particularly skilful investor.”

Mr Dunjey had declared himself bankrupt and appointed Hall Chadwick partner John Shanahan as trustee over his estate in June 2022.