The coronavirus pandemic has heaped further anxiety on dozens of retirees who lost their life savings in a collapsed Australian property scheme.
Sterling First operated in Western Australia, Victoria and Queensland, and spruiked itself as pairing up “smart property investors that are looking to get a better rental return with retirees that are looking to sign a long term lease”.
The group’s 12 entities went into administration last year, leaving more than 100 investors high and dry.
A number of mostly elderly tenants have been forced out of their homes, having believed the lifetime leases would cover 40 years’ rent.
Five have since died.
Advocate Cath Dall, whose 62-year-old mother Sue Lee is among those affected in WA, says the tenants are under enormous stress as they push for compensation and await court outcomes.
“Knowing that we’ve lost five along the way, they’re scared,” she told AAP.
“A lot of them have extremely serious health conditions and we’ve got a few that already have terminal illnesses as well.
“We need it done urgently otherwise we’re going to lose more, just due to their age, their illness and obviously coronavirus now as well.”
While none of the tenants are believed to have contracted coronavirus, restrictions on public gatherings mean they’re no longer able to support each other through regular catch-ups.
“They’ve lost the ability to actually have that face-to-face contact and talk to each other,” Ms Dall said.
Administrators believe Sterling First became insolvent around January last year.
The Australian Securities and Investments Commission allowed promoters to continue selling leases until at least October 2018 despite being aware of red flags surrounding the scheme in early 2017.
With little hope of recouping funds through the liquidation process, some victims are pursing compensation through the Australian Financial Complaints Authority.
The AFCA process will likely hinge on whether compensation can be claimed against any insurance policy held by Theta Asset Management, the responsible entity for the Sterling Income Trust in which many of the tenants invested.
An interim determination in favour of one complainant has provided hope the lengthy process could eventually pay off.
ASIC has meanwhile launched Federal Court proceedings against Theta alleging the group and its managing director, Robert Patrick Marie, failed to ensure product disclosure statements did not contain misleading or deceptive statements.
Other tenants are awaiting outcomes in court cases that could ultimately determine whether they face eviction.
“All we can do is continue to fight,” Ms Dall said.
“I don’t think they thought we’d keep going but we’ve got some extremely strong-willed people that are determined to do what they can to see things set right.”