Mudasir Mohammed Naseeruddin has been sentenced to over four years imprisonment after dishonestly obtaining client funds from six investors’ self-managed superannuation fund (SMSF) accounts.
Naseeruddin is former director of liquidated financial services businesses Secure Investments and Aquila Group. He was first arrested and charged with dishonest conduct in 2020 after dishonestly obtaining super funds from investors based on false representations.
ASIC took civil action to obtain interim orders to preserve the assets of his businesses, which were later wound up after the director operated a financial services business without an appropriate licence.
In August 2023, Naseeruddin pleaded guilty to two counts of dishonest conduct and two counts of failing to discharge his duties as a director in the best interests of a company.
He has now received a 4 years and 4 months total prison sentence on 21 December 2023, and will also serve a non-parole period of 2 years and 9 months.
Specifically, Naseeruddin encouraged investors to transfer their super funds into a newly created SMSF account. This money was then lended to his two companies.
The former director dishonestly obtained more than $520,000 from six investors between 13 May 2015 and 6 January 2020 by convincing the victims that the funds would be invested in property developments. According to ASIC, only a small amount of the client funds were invested in this way.
In addition, Naseeruddin dishonestly withdrew more than $550,000 from his company Secure Investments to purchase shares in a security company for his own benefit over the period 14 July 2016 and 23 December 2019.
ASIC previously stated the maximum penalty for his crimes could have been up to 15 years imprisonment.
“Investors were encouraged to set up SMSFs so they could access their retirement funds to invest in these property companies. Sadly, these investors were taken advantage of and their funds were used dishonestly,” explained Sarah Court, ASIC deputy chair.
“ASIC has been dedicated to this case for some time, freezing the assets of Naseeruddin’s companies in 2019 and obtaining orders to wind up the companies in 2020. Today’s criminal outcome sends a strong message that dishonest conduct by directors will be investigated and prosecuted.”
The sentenced individual’s conduct was described as “egregious and unacceptable” by Judge Todd. She added that Naseeruddin “exploited relationships of trust” and said the effects of his dishonest conduct on victims was “nothing short of ruinous”.
The matter was prosecuted by the Commonwealth Director of Public Prosecutions following an investigation and referral by ASIC.
