'I'm no Skase': Inside Mayfair's investment pitch

McCormick says Mayfair 101’s growth may one day call into question the regulator’s role in monitoring wholesale investors

Clarification

Subjective

The regulator's role is to uphold the ASIC Act and Corporations Act. Their role is not to monitor wholesale investors. An individual either qualifies (and their accountant confirms they qualifiy) or they don't.

The flattery includes testimonials from a widow who just sold the family home and was “all alone and had no idea what to do”.

Misleading

Defamatory

This client was one of over 500 clients who were satisfied with their commercial relationship with Mayfair 101 until ASIC attacked the group shortly after this article being published.

McCormick doubts whether all of Mayfair Platinum’s investors are truly sophisticated enough to assess the financial risks, and whether they can afford to lose their money.

Mr McCormick's views are a question of law, not of Mayfair's business. Mayfair complied with its statutory requirements to only accept monies from wholesale clients.

Mayfair’s light disclosures didn’t seem to trouble many people at the seminar

Accurate

Most of the attendees had about 20+ years more commercial experience than the journalist. They understood they were lenders and not actual investors in specific projects. It is a shame the journalists did not understand this.

The group's corporate structure is a spaghetti bowl of shareholdings, funds and loans, in Australia and the UK.

False

There was no spaghetti bowl. The journalists had never interviewed Mr Mawhinney or any staff member, and not seen a corporate structure diagram, and therefore was in no position to make this statement.

has law and commerce degrees from the University of Western Australia

This demonstrates how the journalists mischaracterised Mr Mawhinney as a 'marketing maven' when they had full knowledge of his formal qualifications.

Mistaken

Mr Mawhinney's formal qualifications are in Law and Commerce.

the staffer testified to receiving no performance warnings

The requirements of the role were clearly set out. The staff member was notified they failed to meet their targets. There was no basis to bring the claim.

he was personally castigated for “evasive conduct” by the Fair Work Commission in his time there

There was no evasive conduct. The one and only time Mr Mawhinney has been to Fair Wark was in relation to a sales representative who was terminated because they did not achieve sales targets. It should never have made it to Fair Work.

“This is what happens when a marketing executive tries to become an investment professional,” he says.

Mr McGowan did not do his research on Mr Mawhinney's qualifications, which are a Bachelor of Law and Bachelor of Commerce with an Investment Finance major. It appears Mr McGowan doesn't hold any investment qualifications which should be concerning for those who rely upon his investment advice.

There is “no transparency around their portfolio”, he says.

This is because Mayfair 101 was not operating a funds management business. Mr McGowan failed to appreciate this critical point.

Tim McGowen, of Informed Investor, has been vocal in his concerns about the IPO Wealth and Mayfair Platinum offerings.

Mr McGowen is a failed fund manager that became a journalist. He was in no position to comment other than in an entirely speculative capacity.

Email from Peeyush Gupta.pdf

Unfortunately I think in five years' time we will see permanent loss of capital for those members of our community who can least afford it.

Out of context

This was a quote by NAB's director Mr Peeyush Gupta. Mayfair 101 contacted Mr Gupta to see if he made this quote in relation to Mayfair 101 considering it was positioned high up in the article with no context around it. See attached copy of the email. The quote was positioned here to make it look like he was speaking about Mayfair 101, when he hasn't.

That’s because unlike a bank that raises safe deposits to lend out to businesses and consumers, Mawhinney is using the cheap funds to back his own speculative investments.

The journalists have micharacterised Mayfair 101's private equity portfolio which comprised approximately 25 distinct investments at the time. A significant portion of the portfolio was Australian real estate. This is hardly a "speculative" asset class, particularly when it is acquired at the bottom of the market (which is what Mayfair 101 did).

And while he stresses these investments carry more risk than money in the bank, even those comparisons are questionable.

A risk warning was provided. The journalists have mischaracterised what was a normal disclaimer.

Across three Mayfair-related offerings, Mawhinney says he’s raised about $180 million from investors and has $500 million of assets under management.

This is why the regulator's action against Mayfair 101 did not make any sense.

But the marketing blitz of new operators worries some.

The "some" Mr Shapiro refers to is the person who was seated next to him at the event Mayfair held in Sydney on 26 November 2019 - Domenic McCormick.

The island is all anyone appears to want to discuss at the seminar to promote his Mayfair Platinum funds.

This quote highlights the journalists' lack of knowledge about Mayfair 101. Mayfair Platinum did not offer funds! Our group never charged anyone to manage their money. There is a distinct difference which the journalist clearly failed to appreciate. It is a concern considering they hold themselves out to be an expert in the investment space.

Misquoted

Mr Mawhinney did not say 'I'm no Skase' at the event. We have this on video. The journalists have misquoted him to create the impression he was the equivalent of international fugitive Christopher Skase because he invested in a major tourism-focused development in Far North Queensland.