Litigation funder IMF (Australia) has agreed to fund claims by various former clients of Perth stockbroker Todd King against Australian Stockbroking and Advisory Services.
Litigation funder IMF (Australia) has agreed to fund claims by various former clients of Perth stockbroker Todd King against Australian Stockbroking and Advisory Services.
In a statement today, IMF said the claims stem from a series of transactions that were in breach of a duty of care by Mr King and the firm.
"The claims will be pursued in an action in the Supreme Court of Western Australia," IMF said.
It added that it is building up a group of former clients wishing to join the action before it proceeds with the claim.
ASAS chairman Alex Burt told WA Business News that the firm had no idea of the type of claim IMF were compiling.
"We have received half a dozen letters from clients only in the last few days requesting us to gather some information and pass it on to IMF," he said.
"Other than that we have no knowledge the type of claim or the basis of any potential claim."
Mr Burt said Mr King had been a sub-authorised representative of ASAS under a corporate licence that the firm had issued to Stripe Capital.
Mr King was a part of a contingent of wealth management advisers that joined Stripe in 2006.
Earlier this year Stripe merged with Blackswan Equities, which opened its doors in May.
WA Business News understands that Mr King was only with Stripe for a short period of time.
Mr Burt said Mr King had informed ASAS in April last year that he wanted establish his own licence under a separate entity. He then left in September.
Mr Burt added that ASAS has notified its insurance company about the claim.
"Obviously someone's on a fishing expedition to see the number of clients involved and what potential there is for a claim," he said.
"We've notified our insurers, we are now in their hands as to what information they will require us to supply.
"And then it's up to them whether we supply that info to IMF."
It's understood the IMF funded claim could be in the millions of dollars.
Meantime, ASAS' marketing name, Asandas, changed its name to Minc Stockbroking earlier this month. ASAS remains as the licence holder.
Mr Burt said the name change was to better align itself with the Minc group.
Late in 2007, Minc Financial Services acquired a 50.1 per cent stake in ASAS, which was previously owned by E*TRADE, now owned by ANZ.
