About the Sterling First scandal
Over 140 elderly Australians ripped off in the Sterling First scandal are demanding a Senate Inquiry into the scheme which fleeced them of millions in life savings, and has left them facing homelessness.
In 2015, the Sterling First Group began raising funds from retirees who wanted to downsize their home, convincing them to pay a lump sum of $250,000-$300,000 as up-front rent for the rest of their lives. Sterling brokered forty-year rental contracts between the retirees and their landlords, but did not disclose the risks of what was actually a convoluted managed investment scheme. By the time Sterling collapsed into administration in 2019, over 140 elderly tenants discovered they were “investors” and had lost millions in life savings. After a controversial 1 June 2021 Western Australian Supreme Court ruling which found in favour of their landlords, they now face imminent eviction. The Sterling disaster highlighted the abject failure of the corporate regulator, the Australian Securities and Investments Commission (ASIC), to stop serial financial predators from preying on vulnerable Australians. Sterling’s ringleaders were involved in numerous financial scandals and Ponzi schemes dating back to the 1990s, costing mum and dad investors hundreds of millions of dollars through exploitative and deceptive financial practises, yet ASIC overlooked Sterling’s obvious red flags, and ignored complaints which were made as early as 2015. Instead of compensating the victims and forcing ASIC to lift its game, the government is effectively throwing the pensioners out on the street.
Victims of the Sterling First scandal are urging parliamentarians to support a Senate Inquiry into the ongoing failings of ASIC. It is imperative that we expose the regulator’s failings and the Morrison government's determination to further weaken financial regulation in Australia. Without an effective financial regulator, vulnerable Australians are abandoned to exploitation by predatory financiers.
In 2015, the Sterling First Group began raising funds from retirees who wanted to downsize their home, convincing them to pay a lump sum of $250,000-$300,000 as up-front rent for the rest of their lives. Sterling brokered forty-year rental contracts between the retirees and their landlords, but did not disclose the risks of what was actually a convoluted managed investment scheme. By the time Sterling collapsed into administration in 2019, over 140 elderly tenants discovered they were “investors” and had lost millions in life savings. After a controversial 1 June 2021 Western Australian Supreme Court ruling which found in favour of their landlords, they now face imminent eviction. The Sterling disaster highlighted the abject failure of the corporate regulator, the Australian Securities and Investments Commission (ASIC), to stop serial financial predators from preying on vulnerable Australians. Sterling’s ringleaders were involved in numerous financial scandals and Ponzi schemes dating back to the 1990s, costing mum and dad investors hundreds of millions of dollars through exploitative and deceptive financial practises, yet ASIC overlooked Sterling’s obvious red flags, and ignored complaints which were made as early as 2015. Instead of compensating the victims and forcing ASIC to lift its game, the government is effectively throwing the pensioners out on the street.
Victims of the Sterling First scandal are urging parliamentarians to support a Senate Inquiry into the ongoing failings of ASIC. It is imperative that we expose the regulator’s failings and the Morrison government's determination to further weaken financial regulation in Australia. Without an effective financial regulator, vulnerable Australians are abandoned to exploitation by predatory financiers.
Compensate now!
Treasurer Josh Frydenberg refuses to call back $27 billion in JobKeeper payments he made to businesses that didn't need the money—because they actually increased their profits during the Covid-19 lockdowns! Yet the Frydenberg-Morrison government refuses to pay a comparatively tiny $18 million compensation to restore the life savings of Sterling First victims, who are suffering because of the appalling negligence of ASIC. ASIC is currently Frydenberg's responsibility, and Prime Minister Scott Morrison was Treasurer during the period when ASIC turned a blind eye to the misconduct of Sterling First directors, enabling them to fleece 140 pensioners of their life savings. Sterling First victims have written hundreds of letters to Morrison and Frydenberg, and personally delivered 110 letters into Frydenberg's hands in April 2021, but have never received any reply. This is a disgusting way to treat elderly Australians who have worked hard all their lives, only to be thrown under the bus by ASIC's failure to do its job.
Frydenberg must pay the $18 million immediately to compensate the elderly victims of Sterling First, some of whom have already died in poverty waiting for justice.
Frydenberg must pay the $18 million immediately to compensate the elderly victims of Sterling First, some of whom have already died in poverty waiting for justice.
Watch: The Sterling First Scam
Sterling First: Myths vs Facts
The Sterling First Report
- The Sterling scandal is far-reaching and goes beyond the rent-for-life scheme. Financial professionals such as mortgage brokers, settlement agents, property consultants and financial advisors were involved in every step of drawing unsuspecting landlords into buying a Sterling investment property. There are indications of coordination between Sterling ringleaders and all the major banks in a mortgage debt scandal. The dubious involvement of ASIC, its lies to parliament and inexplicable protection of Sterling’s predatory schemers, raises serious questions—what is really going on behind the Sterling scandal?
- The Sterling First Report examines the details of the Sterling First case, and the regulatory failings which have allowed vulnerable Australians to be exploited by predatory financiers.