A Melbourne lawyer has been sentenced to three years’ imprisonment, with a non-parole period of one year, for perverting the course of justice and orchestrating an offshore scam to help clients avoid bankruptcy.
AFP Leading Senior Constable Anthony Martin said the fraud was carefully designed to exploit the system. “This scheme was deliberately set out to exploit the financial and legal system,” he said.
“It disadvantages honest businesses and the broader Australian community. Anyone involving themselves in these types of practices is engaging in criminal behaviour and you will be caught.”
The 68-year-old used his law firm to invent fictitious personal debts for two clients, allowing them to secure favourable outcomes during bankruptcy and insolvency proceedings. In return, he gained financial benefit for his practice.
To execute the scheme, the lawyer fabricated and backdated documents that falsely raised a debt owed to a Hong Kong company, which he secretly controlled through a straw director. Insolvency proceedings based on these fraudulent records were then lodged in the Victorian Supreme Court.
By making the Hong Kong company appear as the largest creditor, the lawyer ensured that personal insolvency agreements (PIAs) proposed by his clients were approved. The agreements allowed the clients to repay only a fraction of their debts, with funds channelled back to the law firm and the clients.
He pleaded guilty in November 2024 to one count of attempting to pervert the course of justice—an offence carrying a maximum penalty of 25 years’ imprisonment—and two counts of obtaining financial advantage by deception, which each carry a maximum of 10 years.
The two clients involved were charged under the Bankruptcy Act in 2016. One was fined and convicted, while the other’s offence was proven without conviction.
Australian Financial Security Authority CEO Tim Beresford urged people in financial distress to seek advice only from trusted professionals. “Unfortunately, there are people who deliberately manipulate the system to their personal advantage,” he said.
“AFSA is committed to ensuring that individuals or businesses which cause harm and exploit the system are investigated and held accountable.”
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