Charterhill director George Nowak has been sentenced to 10 years of imprisonment for misappropriating $1.2 million in self-managed superannuation fund (SMSF) monies to fund a lavish lifestyle.
The District Court of South Australia’s sentence included a non-parole period of six years and three months. Nowak was also automatically disqualified from managing a corporation for five years.
The sentence followed Nowak pleading guilty to 17 counts of aggravated deception and one count of dishonest dealings with documents in February.
The SMSFs were undertaking property purchases offered by companies Nowak was a director of, including EJ Property Developments.
Judge Sophie David noted in her sentencing that the “fraud had a significant impact on the victims’ lives and was perpetuated in order to fund a lavish lifestyle”.
The Australian Securities and Investments Commission (ASIC) commissioner Danielle Press said: “Mr Nowak deliberately misled his clients and used their funds for his own benefit.
“Mr Nowak dishonestly and deliberately breached his clients’ trust. The court’s sentence reflects the seriousness of this conduct and the impact it had on Mr Nowak’s clients.”
The impact of identity theft and its threat to superannuation savings were highlighted in a case that went before the Federal Court at the end of 2023.
A recent NSW Supreme Court decision is an important reminder that while super funds may be subject to restrictive superannuation and tax laws, in essence they are still a trust and subject to equitable and common law claims, says a legal expert.
New research from the University of Adelaide has found SMSFs outperformed APRA funds by more than 4 per cent in 2021–22.
The SMSF Association has made a number of policy recommendations for the superannuation sector in its pre-budget submission to the government.