Financial adviser earned thousands from failed scheme

Tribeca Homes' director Mark Richards. Photo / Nick Reed

A financial adviser earned hundreds of thousands of dollars in commission steering clients into a housing development scheme that failed, leaving derelict building sites and buyers facing substantial losses.

Last week, Tribeca Homes' sole director, Mark Richards, blamed subcontractors in conceding his firm was unable to honour the contracts of about 40 clients.

These home-buyers, who sought either residences or investment properties, complained of rotting building materials, waits of up to three years and financial stresses that had pushed retirement plans and marriages to the brink.

Tribeca's main salesman, Ritesh Mani, was into his second bankruptcy when he closed deals with the majority of the company's clients and attended training seminars run by Jordan Belfort, the convicted fraudster on whom The Wolf of Wall Street was based.

An investigation by the Herald has revealed the majority of Tribeca's clients, who paid the firm sums ranging from $22,000 to several hundred thousand dollars, were referred by financial adviser Daniel Carney.

Carney, an authorised financial adviser and director of Goodlife Financial Advice, confirmed he did receive commission payments for directing "around 40" clients to Tribeca, but said these payments were "way below industry standards" and were properly disclosed.

"It was all transparent. It was a normal relationship with a service provider that we got paid for introducing clients. Every single dollar of commission that flows through our office is declared," he said.

While unwilling to provide specific commission figures, Carney said they were outweighed by the fallout from Tribeca's failure.

"I cringe when I know what we got and the amount of flak [Tribeca has] put in front of us. The remuneration doesn't add up to the hassle," he said.

Sources familiar with Tribeca's finances said between $5000 and $7000 was paid to Carney and Goodlife for each successful referral, suggesting the adviser and his firm collected up to $280,000 in the 18 months the scheme was running.

Carney said he was also a victim of the scheme's failure, having also bought a Tribeca home that was unfinished.

Of his dealings with Tribeca, he said: "I think it's appalling and I'm disgusted.

"I've lost a lot of money, and probably health as well.

"That's a story that's common across my whole client base.

"It's heartbreaking, and what can you do?"

Carney said he was taking legal advice over whether he or his clients had a case against Tribeca.