$20 million in penalties dished out to Dominique Grubisa and co

The Federal Court has handed significant penalties to wealth guru Dominique Grubisa and her company, as IA reports.

LAST FRIDAY, Justice Ian Jackman handed down his judgment in the penalty phase of the case brought by the Australian Competition and Consumer Commission (ACCC) against Dominique Grubisa and her company, Master Wealth Control Pty Ltd, trading as DG Institute.

Justice Jackman imposed a $5 million fine on DG Institute, a $1 million fine on Grubisa and banned her from managing corporations for a period of five years. Additionally, he ordered DG Institute to offer refunds for people who bought the asset protection product between April 2017 to November 202, totalling approximately $14.7 million.

His Honour described Grubisa’s conduct as deliberate and dishonest. He also noted that there had been no expression or demonstration of contrition by Grubisa or DG Institute. Should we be surprised by that, given Grubisa’s self-described narcissism?

Dominique Grubisa faces penalty hearing in Federal Court

Fraudulent property guru Dominique Grubisa and her company, Master Wealth Control, have been back in court in the ACCC case.

Time to don the scuba gear again and do a deep dive into the decision.

As we reported earlier this month, the ACCC seems to have dropped the ball in seeking compensation orders against Grubisa personally. Justice Jackman noted that the ACCC didn’t ask for information about the current asset position of DG Institute until a notice to produce was served on 12 April.

The ACCC had been provided with profit and loss statements from 2017 to 2023 in July 2023 but didn’t seek information as to the net asset position of DG Institute or the wider group of companies. The profit and loss statements showed that while DG Institute had a total revenue of $53.6 million over that period, it purportedly made a net loss.

His Honour said in his judgment [IA emphasis]:

‘The ACCC accepted that any intelligent reader of the material which had been produced on 5 July 2023 (about eight months before the liability hearing) would have been alive to the possibility that DG Institute would not be able to meet a non-party consumer redress order.’

It seems likely that despite all the work involved in the case, consumers who were misled regarding the asset protection product will not see their money back. Where did the money go, you might ask? Well, over $5.8 million was supposedly spent on Facebook ads. “Event costs” of approximately $5.5 million, $4.7 million, $5.6 million, $4.5 million, $4.5 million and $2.3 million were recorded for the financial years 2018 to 2023.

Justice Jackman pointed out the “remarkable coincidence” that DG Institute achieved a break-even position to the nearest dollar two years in a row, but noted that the ACCC did not perform any analysis of the figures which would have “thrown light” on whether that coincidence was no coincidence.

ACCC ends Grubisa's fraud and deceptions — and vindicates IA's long investigations

The Federal Court says two programs sold by Dominique Grubisa’s company involved false claims and she was knowingly involved.

Another interesting aspect of the judgment was the suggestion that the programs marketed by Grubisa are no longer sold.

Justice Jackman noted:

‘As to whether DG Institute has a corporate culture conducive to compliance, there is no evidence that DG Institute had a corporate culture conducive to compliance at the time of the contraventions, or that it has taken any steps to change its culture in this regard since that time. However, the programs in question are no longer sold.’

After the ACCC commenced its litigation, Grubisa continued to market the asset protection product through Property Lovers, a company of which her husband, Kevin, is the sole director. Property Lovers is not a law firm. The asset protection product continued to be sold through Property Lovers throughout 2023.

The law firm representing Grubisa and her company in the ACCC case, Assure Lawyers, also took to selling the asset protection product. FAQs on the Assure Lawyers website were lifted from the equivalent page on the DG Institute website.

Still on the website of Assure Lawyers is the claim that the “Vestey Trust” will protect the client from an attack from any “outsider”, a claim that has been found to be false.

The Assure Lawyers website tells clients that if they have queries about whether an existing company can be used as the trustee, to email mwc@dginstitute.com.au and “my team” will confirm if the company is suitable. DG Institute is also not a law firm.

Grubisa doubles down (again) after ACCC hearing

Dominique Grubisa is yet again being a bit loose with the truth, as IA reports.

Property Lovers is also still marketing the distressed property program, which was for years marketed as “Real Estate Rescue”.

Marketing for the program claims you will learn:

‘How to take control of a property without paying capital gains tax or stamp duty.’

If you are not paying capital gains tax, you are paying income tax. But what’s some more misleading conduct given Grubisa’s history in this regard? Speaking of misleading conduct, in his judgment, Justice Jackman pointed out that Grubisa’s remedial proposal only further compounded the misleading conduct.

Justice Jackman said about remedial proposals put forward by Grubisa’s counsel [IA emphasis]:

The respondents’ proposed remedial scheme thus involves a false and misleading representation in further contravention of the ACL and is manifestly inappropriate as the basis of any order by the Court. Moreover, by proposing a misleading and deceptive scheme, the respondents have demonstrated that they have learnt little or nothing from the Liability Judgment, and certainly have not demonstrated contrition or any other conduct which might mitigate the orders which the ACCC seeks.

DG Institute and Property Lovers are still the subject of an investigation by the Office of the Australian Information Commissioner (OAIC) into potential breaches of the Privacy Act. On 29 May, the federal Privacy Commissioner, Carly Kind informed Senator David Shoebridge that she expected the OAIC’s investigation to be concluded imminently.

Grubisa also has two cases against her brought by the Law Society of NSW. Those cases return to the NSW Civil and Administrative Tribunal (NCAT) for a directions hearing in August.