Proceedings have been commenced against a foreign exchange broking company, Chats House Investments Pty Ltd, a present director, and a former director, alleging that their actions lost approximately 30 clients tens of thousands of dollars each.
The action has been brought by the Australian Competition and Consumer Commission (ACCC) after an investigation by the Australian Securities Commission (ASC) of possible misleading conduct by the company, its present director, Albert Chan, and former director, Donald Aylett.
ACCC Chairman, Professor Allan Fels, and ASC Chairman, Mr Alan Cameron said the ASC investigation indicated that Chats House actively sought inexperienced people to be its agents, trained them poorly, then sent them out to bring potential investors to the business.
"Foreign exchange is a high risk business, in which the largest, best advised institutions can get burnt," they said.
"The ACCC alleges that Chats House demanded thousands of dollars in margin calls and interest charges, on the false basis that it was passing on demands made by the banks Chats House dealt with. The ACCC also alleges that Chats House misrepresented a close business association with Bankers Trust."
The ACCC will pursue the matter as a representative action, seeking damages on behalf of former Chats House clients.
The ACCC alleges this conduct by Chats House and its present director, Albert Chan and former director, Donald Aylett is in breach of sections 51AA, 51A, 52 and 53(d) of the Trade Practices Act. It also alleges deceit by all three respondents.
On Friday 26 April 1996, the Federal Court accepted undertakings from Chats House and Mr Chan that they would not engage in foreign exchange trading.
Undertakings were also given restricting access to money in bank accounts and controlling the movement of money or other property out of Australia.
A directions hearing is being held in the Federal Court, Sydney today.
Professor Fels and Mr Cameron agreed that the business community should expect further joint exercises.
The action has been brought by the Australian Competition and Consumer Commission (ACCC) after an investigation by the Australian Securities Commission (ASC) of possible misleading conduct by the company, its present director, Albert Chan, and former director, Donald Aylett.
ACCC Chairman, Professor Allan Fels, and ASC Chairman, Mr Alan Cameron said the ASC investigation indicated that Chats House actively sought inexperienced people to be its agents, trained them poorly, then sent them out to bring potential investors to the business.
"Foreign exchange is a high risk business, in which the largest, best advised institutions can get burnt," they said.
"The ACCC alleges that Chats House demanded thousands of dollars in margin calls and interest charges, on the false basis that it was passing on demands made by the banks Chats House dealt with. The ACCC also alleges that Chats House misrepresented a close business association with Bankers Trust."
The ACCC will pursue the matter as a representative action, seeking damages on behalf of former Chats House clients.
The ACCC alleges this conduct by Chats House and its present director, Albert Chan and former director, Donald Aylett is in breach of sections 51AA, 51A, 52 and 53(d) of the Trade Practices Act. It also alleges deceit by all three respondents.
On Friday 26 April 1996, the Federal Court accepted undertakings from Chats House and Mr Chan that they would not engage in foreign exchange trading.
Undertakings were also given restricting access to money in bank accounts and controlling the movement of money or other property out of Australia.
A directions hearing is being held in the Federal Court, Sydney today.
Professor Fels and Mr Cameron agreed that the business community should expect further joint exercises.