Sydney, July 22: The Federal Court has ordered Master Wealth Control Pty Ltd (DG Institute) to pay $5 million in penalties for making false or misleading representations to consumers regarding two education programs: Real Estate Rescue (RER) and Master Wealth Control (MWC). Additionally, DG Institute must pay $14.7 million in consumer redress to students enrolled in the MWC program.
The redress orders require DG Institute to refund course fees to over 2100 students who enrolled in the MWC program between April 2017 and November 2022.
DG Institute’s sole director, Dominique Grubisa, was also fined $1 million and disqualified from managing corporations for five years for being knowingly involved in the contraventions by DG Institute.
“These orders underscore the importance for businesses and company directors to ensure statements made to consumers promoting their products and services are accurate and not misleading,” ACCC Commissioner Liza Carver said.
“The substantial consumer redress orders, the penalties imposed and the five-year disqualification order against Grubisa reflect the serious nature of the conduct, and clearly demonstrate the consequences of making false claims when promoting goods or services to consumers.”
DG Institute must contact eligible consumers for redress and post information about the redress scheme on its website and Facebook pages. The Court also issued injunctions preventing DG Institute, its officers, and Grubisa from making similar representations for five years. Additionally, DG Institute and Grubisa are required to pay the ACCC’s legal costs.
The ACCC is carefully considering the Court’s judgment.
The ACCC began legal action against DG Institute and Grubisa in December 2022. DG Institute offers courses and mentoring programs, including RER and MWC, related to property and business investment strategies.
On April 9, the Federal Court found the company made false or misleading representations in promoting and selling the RER and MWC programs, violating Australian Consumer Law.
The Court found the following statements about the programs to be false or misleading: Students of the RER program would be able to assist distressed homeowners to sell their home and retain some of the equity, whereas if a mortgagee were to repossess the property, the homeowner would lose any remaining equity in the property – including because “banks don’t give change.” In fact, a mortgagee is only entitled to amounts owed to it, plus any reasonable costs of recovery. Students of the MWC program could completely protect all their assets from creditors by setting up a specific trust DG Institute called a ‘Vestey Trust’ using transaction documents provided by DG Institute. In fact, the transaction documents provided did not provide the level of protection from creditors promised. The ‘Vestey Trust’ system promoted by DG Institute had been tested and upheld as effective by the Full Court of the Federal Court of Australia in the ‘Sharrment’ case, when in fact this was not the case.
The RER program and the MWC program were promoted through free in-person seminars, free online webinars and videos featuring Grubisa, and on the DG Institute website.
Between 2017 and 2022 well over a thousand students enrolled in the programs, and each paid between $4,500 and $9,200 to participate.
Grubisa is and was at all relevant times the sole director of DG Institute.
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