Former Melbourne financial planner Bradley Grimm has been convicted by the County Court of Victoria of three counts of engaging in dishonest conduct while running a financial services business.
Mr Grimm was sentenced to 18 months' imprisonment, with nine months to serve, and to be of good behaviour for a period of 18 months upon release pursuant to a recognisance in the amount of $5,000.
Mr Grimm engaged in dishonest conduct on five occasions between 18 February 2015 and 12 March 2015, when he transferred funds between two of his clients' self-managed superannuation funds (SMSFs) to three separate companies of which he was the sole director.
Mr Grimm has admitted each of the companies: Thrive Lending Pty Ltd, Trade BTC Pty Ltd, and Beta Pharmacology Pty Ltd, had little market value.
On a further seven occasions between 5 November 2015 and 11 November 2015, Mr Grimm dishonestly transferred shares and convertible notes owned by his clients' SMSF to Equity Capital Partners Hedge Fund Pty Ltd, without adequately advising his client that it was a company of which he was the sole director, and in which he had a personal interest.
Mr Grimm also failed to advise his client that ASIC had sought the winding up of entities related to him, including Ostrava Equities Pty Ltd, and that he was banned from providing financial services by order of the Federal Court.
In sentencing Justice O'Connell remarked that Mr Grimm was "well aware of his obligations" and that he "abused the position of trust that a licensed financial adviser holds". His Honour found that Mr Grimm's "moral culpability was high".
In imposing the sentence, Justice O'Connell took into account Mr Grimm's guilty plea.
Background
Mr Grimm and his company Ostrava Equities Pty Ltd were authorised representatives of former Australian financial services licensee Marigold Falconer International Limited.
Mr Grimm first appeared before the court on 29 November 2018 (18-360MR) and entered a plea of guilty on 20 January 2023 (23-010MR).
Mr Grimm's charges followed ASIC's successful action in the Federal Court for the winding up of Ostrava Equities Pty Ltd, Ostrava Asset Management Pty Ltd, Ostrava Securities Pty Ltd, Ostrava Wealth Management Pty Ltd, Beta Pharmacology Pty Ltd, Prometheus Capital Pty Ltd, Thrive Lending Pty Ltd, Trade BTC Pty Ltd and Equity Capital Partners Hedge Fund Pty Ltd (16-286MR) and (18-360MR).
