The
Secretary
Joint
Parliamentary Committee on Accounts.
Dear
Secretary
We have
just come across an interesting item of information relating to the MMTEI
project which reportedly attracted the largest number of investors, Budplan
.
When Mark
Pownall reported the ATO attack on MMTEIs in The West Australian on
25th March 1998, Sue Price CPA, CFP Managing Director of Monpro
(Money Products Innovations ACN 071 566 080) sent a Newsflash to the Monpro Ltd
Dealer network:
It said
among other things: “The article states that many of the schemes are based on
round robin arrangements. This does not implicate Budplan as it does not use
round robin structures.”
Of interest
then are the following:
Howland
Rose (Budplan Personal Services) - Federal Court - Conti
J:
Quote:
“There did
appear in the Clayton Utz opinion the following expression of
opinion:
"...it is our opinion that the
present transaction could not be seen to constitute a sham. Notwithstanding that
there is in effect a `round robin' of moneys, given the association between the
Lender and Manager, it is our understanding that all the parties intend to
create real obligations pursuant to the transaction
structure."
and
“45 Mr
Lucas, one of the directors of BARM, ATTORI and PGF, explained, by reference to
documentation the process which occurred in relation to the "round robin"
transactions as follows:
(i)
Individual loan applications received from participants were grouped together
and processed in batches; for each batch, the details of the loan of $12,000
payable for a participant's first year of participation were recorded on loan
settlement schedules, typically of 40 to 50 units for each schedule.
(ii) Bills
of exchange were drawn in respect of the aggregate amount the subject of each
batch, the drawer being PGF as purported lender to each participant, the payer
being First Sydney Investments Pty Limited ("FSI") as purported financier, and
the payees being ATTORI and BARM for scientific research and management services
as to 90% and 10% respectively (see [11], [12(iii)] and [29] above).
(iii) PGF
gave to FSI notice of PGF's intention to operate each bill facility by way of an
acceptance notice, in each case the tenor of the bill being specified as one
day.
(iv) Upon
delivery of each bill of exchange by FSI to the payee (either ATTORI or BARM),
the payee endorsed the bill back to PGF as purported lender; in so doing, each
payee purportedly placed its entitlement as payee on deposit with PGF.
(v)
Following such endorsements, the bill of exchange was cancelled, typically one
minute after the time of the drawing thereof.
(vi) A bill
facility register was maintained with details of the bills being drawn in
respect of each batch of loans, the register recording the time and date of
drawing of each bill, and of subsequent cancellation thereof; the bills were
typically cancelled one minute after the time of drawing thereof.
(vii) The
process was repeated at the commencement of the second year term of each
participant's borrowing of $12,000 by way of the second tranche of
funding.”
What then
were the promoters telling Monpro?
Australians
for Tax Justice Inc