The Fraud

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The fraud against the cestuis que trust (members and beneficiaries) of an occupational pension fund established on 23 December 1913 in the State of South Australia is remarkably easy to prove with a few documents, an Act of Parliament  and a basic understanding of the law of trusts.

It is trite law that a trustee must obey the original Trust Deed that established the trust as lawfully amended.

Once a trust has been properly constituted, the terms of the trust cannot be amended in any manner whatsoever. If this was the case it would destroy the whole legal rationale for the existence of trusts.

{IMPORTANT: The position taken by ASIC is that a trustee, or even a party not lawfully appointed to the office of trustee, can amend the terms of a superannuation trust in any manner whatsoever, even if the trustee has not been provided with a Power of Amendment by the original Trust Deed that established the trust.}

Before the terms of a trust can be amended, the original Trust Deed must provide an amending power referred to as a Power of Amendment, which terms who holds the Power of Amendment and what conditions and restrictions may be imposed on the exercise of the Power of Amendment.

If the original Trust Deed provides a Power of Amendment, then this power like any other power provided to Trustees, must be used to promote the purpose of the trust and in the interests of the beneficiaries of the trust and not be used for the benefit of the trustees or third parties.

Any conditions and restriction imposed by the Power of Amendment must themselves be strictly observed.

The power provided in the terms of the trust to removed and appoint trustees is generally construed as a “fiduciary power” , even when the holder of the power is not a fiduciary (such as an employer). The power to remove and appoint trustees must therefore be used for the benefit of the beneficiaries and cannot be such subject to a conflict of interests or be used for an ulterior motive.

The Fraud relates to purported amending instruments that purported to abrogate the right of widows to receive a survorship pension and reduce retirement and retrenchment benefits by over 80% which was facilitated by the unlawful removed of five lawfully appointed natural person trustees, two of whom had been elected by the members of the fund and one by the pensioners.

The Fraud can be proven simply by counting the number of Directors’ signatures that appear of a document signed by a well known white-collar criminal.

 

More details of the fraud are provided here

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