A bankrupt Gold Coast developer who misappropriated almost $2.3 million of investor funds has been sentenced to nine years behind bars.
Ian Omar Chester, 44, appeared in Southport District Court today, where he pleaded guilty to one count of fraud.
The court heard between May 2017 and April 2021, the former carpenter turned property developer dishonestly used $2,294,239 of investor funds.
Of these funds, Chester used more than $600,000 for personal benefit.
Investors had initially transferred the funds to companies controlled by Chester for the purpose of developing five property projects in south-east Queensland between 2016 and 2020.
The projects at Main Beach, Sovereign Island, Yarrabilba, Spring Hill and Loganholme had attracted almost 190 investors.
The court heard many investors used money from their own self-managed super funds to invest, with investments ranging from $25,000 to $200,000.
Information memorandums were provided to investors, stating that the funds raised would be solely used for purposes relating to that project.
But the court heard between May and September 2017, Chester created 79 false letters of authority and signed them electronically in the name of investors.
The letters were provided to Chester's solicitor and enabled funds to be transferred for purposes "unrelated to the relevant project".
The court heard the offending was detected after multiple reports of misconduct to the Australian Securities and Investments Commission.
Chester has since declared bankruptcy, the court heard, with no restitution recorded.
'Crushed, shattered and empty'
Seventeen victim impact statements were tendered to the court, with many victims saying they had lost their superannuation funds or life savings.
One woman said she and her husband were "crushed, shattered and empty" in the wake of the fraud.
Judge Katarina Prskalo KC said she sentenced Chester on the basis that he initially intended to "make good" on his commitment to investors.
However, she said it appeared Chester misapprehended the "nature and scale" of the projects, and "quickly became out [his] depth".
"You responded to mounting pressures of debts, deadlines and partly completed projects by deferring discussions about returns on investments," she said.
Judge Prskalo said while this explained how Chester came to offend, she said it did not alter the fact that the offending was "sustained and deliberate dishonesty".
Chester's defence submitted that a period of nine years' imprisonment with parole after two years would be appropriate, given several factors including his lack of criminal history, his remorse, and the fact he provided child support to two of his three children.
The judge said she took these factors into account in sentencing Chester, as well as his guilty plea and the fact he had not offended further while on bail.
"I accept, having regard to all the material placed before me and your letter, that you are remorseful," she said.
"However, the offending was detected through reports to ASIC and not through any disclosure by you."
She sentenced Chester to nine years in jail, with parole after three years.
