Media and information releases
05-213 ASIC warns holders of Liban Net car insurance to consider re-insurance
Wednesday 27 July 2005
The Australian Securities and Investments Commission (ASIC) is urging anyone who obtained car insurance through Australian Private Insurance or API to consider reinsuring their motor vehicles with an authorised insurer, after Sydenham-based Liban Net Pty Limited (Liban Net) and its sole director, Mr Gaby Haddad, of Yagoona in New South Wales, failed to comply with an order of the Federal Court relating to ASIC's current action.
Liban Net and Mr Haddad, which allegedly own Australian Private Insurance and API, have failed to provide ASIC with a list of the names and addresses of all persons having been issued policies of insurance by it, in its name or in the name of API or Australian Private Insurance.
Further, Mr Haddad and Liban Net failed to appear at today's court directions hearing.
ASIC is concerned that the insurance cover provided by Liban Net and Mr Haddad under the trading names of Australian Private Insurance or API may not be valid, and is encouraging anyone who bought insurance through them to consider reinsuring their motor vehicles through an authorised insurer.
Australian Private Insurance and API are not associated with API Insurance
Services, a business owned by the Australian Post-Tel Institute (SA & NT) Incorporated.
The matter has been listed for a final hearing on Tuesday 16 August 2005.
Background
ASIC is concerned that Liban Net offered and issued comprehensive and third party car insurance policies to members of the public without the authority to offer and issue such insurance.
ASIC is also concerned that representations made by Liban Net that the insurance policies issued by Australian Private Insurance or API are underwritten by Zurich are false.
The effect of Liban Net and Mr Haddad's conduct is that the insurance policies issued by Australian Private Insurance or API may be worthless, given that Liban Net, Mr Haddad, Australian Private Insurance and API are not:
holders of an Australian Financial
Services licence;
holders of authority to act as representatives of licensees; or
authorised insurers with the Australian Prudential Regulation Authority, as legally required.
On 29 June 2005, the Federal Court also ordered that Liban Net and Mr Haddad be restrained from dealing with, or disposing of any money received from any person who has purchased insurance contracts issued by or on behalf of Liban Net, or in the names Australian Private Insurance or API.
ASIC will be seeking declarations of contraventions of provisions of the Corporations Act 2001 and the ASIC Act 2001 against the defendants. Any person who suffers loss or damage as a result the contraventions may rely on the declarations and seek recovery of the amount of the loss or damage from the defendants.
For further background, refer to ASIC Media Release 05-195 ASIC restrains Liban Net car insurance providers.
Full story:
http://www.fido.asic.gov.au/fido/fido.nsf/byheadline/05-213+ASIC+warns+holders+of+Liban+Net+car+insurance+to+consider+re-insurance?openDocument