Aus: DPP discontinues against Henry Kaye

The CDPP advised the court that new evidence has been presented by a witness that was significantly different from the evidence given by the same witness at the committal proceedings. As a consequence, the CDPP advised the court that it had reassessed the prospects of conviction of Mr Kaye in the light of the new evidence and decided to discontinue proceedings. Mr Kaye was due to stand trial in July charged with one count of dishonestly obtaining a financial advantage for another by deception. The case involved a AUD17.7 million credit facility provided by St George Bank to a developer of the Oasis apartments in St Kilda, Victoria. The bank provided the credit facility on the basis that sufficient unconditional contracts of sale for the apartments had been secured by Mr Kaye. The vast majority of purchasers paid the 10 per cent deposit by way of a GIO deposit bond. Mr Kaye in his negotiations with GIO provided a waiver letter that brought into question the validity of the deposit bonds. The proceedings discontinued arose out of ASIC’s involvement with Mr Kaye in relation to his wealth creation seminars and financing activities. In 2003 and 2004, ASIC mounted extensive investor-orientated civil action against Mr Kaye seeking compensation for investors he had misled. ASIC obtained undertakings from Mr Kaye preventing him from conducting wealth creation seminars and requiring him to compensate investors. ASIC’s proceedings culminated in September 2004, when the Federal Court declared Mr Kaye was involved in misleading and deceptive conduct. Mr Kaye was a director of a number of companies within the Provident Group. The Group used seminars as a marketing channel for its property development and financing activities. ASIC commenced civil proceedings in March 2003 after it obtained evidence that companies associated with the Provident Group were using misleading information during these seminars. As part of its investigation of Mr Kaye’s seminars, evidence came to light in February 2004 that led ASIC to commence a separate investigation into the circumstances surrounding Mr Kaye’s credit facility obtained from the St George Bank.

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