‘Gift of the gab’: Home scam leaves hundreds heartbroken
A GOLD Coast chef chasing the great Australian dream for his family faced a financial nightmare when he was snared in a dodgy first homebuyer scheme.
Tallai's Adam Paenga was one of 268 consumers taken for a ride by Burleigh Waters man Kent Paul Scarborough after he forked out $6000 to put a roof over his family's head.
"All I ever wanted was a house for my partner at the time, my two children and me," he said.
"I'd been struggling to get a first-home deposit going. I got home from work one night, was on the internet and an ad popped up about basically no deposit or low-deposit homes."
Mr Paenga made weekly payments - but he may as well have tossed the cash into the wind.
"They had the gift of the gab about what they were doing," he said.
"I feel sad people have been taken advantage of, I don't want it to happen to anyone else."
Mr Paenga's tale is part of a three-part Bulletin investigation into dodgy scams across the city and the fight by authorities to weed out shonky operators.
Scarborough - who operated Brilliant Asset Management Pty Ltd and BAM Finance Pty Ltd (also trading as Noble and Cormack) - pleaded guilty in Southport Magistrates Court late last year to 27 counts of making false or misleading representations in breach of consumer law.
The charges were dated over 12 months from March 2016.
Scarborough, who siphoned money from vulnerable battlers, was slapped with a $50,000 fine and ordered to pay back $97,925 to victims including a disabled student, immigrants, a refugee and Centrelink recipients.
Ten months on, Mr Paenga says he is yet to receive a cent of the money he paid.
"It'd be nice if I got the money back. I believe it's gone to SPER (State Penalties Enforcement Registry). With that system they basically pay back what you want.
"Chefs are the lowest-paid trade out there, so yeah, it was definitely a bit of a hit for me."
In total, 27 consumers helped the Office of Fair Trading (OFT) investigate Scarborough, who ran a scheme leading consumers to believe they were making payments into a home deposit plan. Victims paid amounts of $110 to $10,700, according to the OFT.
Those involved were given a certificate and told it was valued up to $40,000 and could be used to purchase a home anywhere in Australia.
But none of the consumers who entered the scheme could obtain finance - no bank or financial institution would accept the certificate.
Mr Paenga is speaking out to warn others that if a deal looks too good to be true, or alarm bells ring, it is better to ditch the deal or seek help.
He said red flags included patchy communication over time and a lack of documentation.
"Alarm bells were ringing about the whole scenario. I started getting sus on it. I was ringing them up on a weekly basis and they weren't getting back to me.
"They basically made me believe, as the ad stated, only 50 people were eligible, so I'd better get on to it as soon as possible. I just didn't want to miss the opportunity at the time."
Mr Paenga was chasing answers when the OFT told him of their investigation.
Magistrate Jane Bentley gave a scathing assessment of Scarborough's actions in court.
"Sadly, the people who paid you this money were the type of people who could least afford to lose their money," she said.
Ms Bentley described the offending as "persistent, deliberate and it seems to me it was cruel".
Scarborough was suffering from "major depression" and had no prior criminal history or consumer law breaches, the court was told.
Ms Bentley said the seemingly "philanthropic home deposit scheme" just "wasn't realistic".
OFT Executive Director Brian Bauer said the scheme specifically targeted susceptible consumers simply trying to provide homes and stability for their families.
"The Office of Fair Trading will not stand for such unscrupulous exploitation and any traders with similar ideas should consider themselves on notice."
Originally published as 'Gift of the gab': Coast scam leaves hundreds heartbroken