Major bank to pay property investors

ASIC has welcomed the decision of a major lender to compensate an additional seven investors in a failed scheme associated with one of the bank’s former home finance managers.

Westpac will pay seven former clients of former home finance manager David St Pierre, who was permanently banned from engaging in credit activities or financial services in March.

ASIC found Mr St Pierre had “submitted loan applications to Westpac for approval when he knew that they contained false information and that they were supported by false documents”.

A small number of customers who borrowed through Mr St Pierre have already been compensated by Westpac for the amounts they invested and their legal fees, according to ASIC.

However, in a statement issued late last week, the regulator said that as part of its ongoing investigations, it became aware of seven additional investors who did not borrow funds from Westpac but claimed to have had some direct contact with Mr St Pierre before making their investment in Capital Growth.

“ASIC welcomes Westpac's decision to make payment offers to these additional cash investors in response to the circumstances of the individual investors and the alleged dealings with Mr St Pierre,” it said.

“Westpac has provided investors the opportunity to receive independent legal advice regarding the offer made by Westpac.

“ASIC acknowledges Westpac's ongoing commitment to achieving a resolution for the benefit of Capital Growth investors.”

ASIC’s investigations into Capital Growth, its failure and its officers are continuing.

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