The long arm of dishonesty doesn’t catch up with an applicant for the provision of “credit services” … ASIC smells danger but the High Court says spent convictions must be ignored … Hair-raising collection of ancient offences and scrapes … Law admission blocked and struck-off as a migration agent and a tax agent … Janek Drevikovsky reports 

Last we heard, the Law Institute of Victoria took away his ticket and so too the outfit that licenses migration agents. ASIC also didn’t want to give him permission to engage in credit activities.

Finally, some good news for long-suffering Rudy – the High Court has given him the chance to overturn ASIC’s decision, finding legal mistakes in the proceedings. 

The initial banning order was made in 2014, when ASIC decided Rudy was unfit under the Credit Protection Act to get a license to be a mortgage broker. Rudy had this decision reviewed by the AAT, which upheld the corporate policeman’s ruling. The tribunal pointed, inter alia, to a string of prior offending beginning in 1978 and stretching to the late 1990s. 

It was Rudy’s failure to disclose these indiscretions that deprived him of registration.

Justice Mordecai Bromberg in the Federal Court dismissed the ensuing appeal.  finding the undisclosed convictions were part of a pattern of dishonesty: 

“A person in the habit of baldly lying, especially one who sees nothing objectionable in that habit, is unlikely to be fit and proper to engage in activities involving trust and vulnerability.”  

The High Court threw him a lifeline on May 15 finding those pesky convictions were spent and he wasn’t required by law to disclose them. The whole thing has to start again before the AAT.

Failure to disclose has been a habit of Rudy Frugtniet as he shonked his way across the landscape and through most levels of the Australian court system. Justice Bill (Silver Tray) Gillard, as he then was, said he, “carries with him a massive bag of dishonest conduct”. 

Let’s take a look at what’s in this “massive bag” …

Rudy Noel Frugtniet was born in Sri Lanka and grew up in the UK. He was in strike before he turned 20, with his first convictions in 1978 on 15 counts of handling stolen goods, forgery, and obtaining property by deception and theft, for which he did two years in the clink.

He migrated to Australia. By 1989, he was working as a travel agent and in that year, the wallopers tried prosecuting him for deception, alleging he had charged customers’ credit cards twice for the same transaction. The case was dropped when a bank witness refused to cooperate. 

In 1997, it turned out he had been selling dud airline tickets. The Broadmeadows Magistrates’ Court fined him $1,000, but didn’t record a conviction.

That same year, the Travel Agents’ Licensing Authority accused him of perjury, for statements he’d made while a witness in another court case. Rudy had persistently denied he had any prior convictions – despite his stint of porridge in Blighty. 

Foreshadowing the later ASIC case, Rudy was acquitted because the convictions were spent under UK law and he was under no obligation to disclose. 

Around this time, Frugtniet left the travel business and became a migration agent. He also found a job at the ANZ bank where his term of employment was brief. In 1998, he was charged with using clients’ bank details to skim from their accounts. He was acquitted, but left the bank. 

Around the turn of the century, he tried his hand at the law caper. He took a law degree at Deakin University and after graduating in 2001 applied for a professional licence.

Rudy told the board of examiners that he was fit and proper. He disclosed the $1,000 fine imposed by the Broadmeadows’ beak but kept shtum about the other run-ins.  

The board figured it all out, and refused to give him a ticket. Rudy appealed to Tony Pagone J at the Vic Supremes who heard his case in 2002.

HH agreed with the board, finding Rudy’s failure to disclose cast doubts on his fitness for admission. 

Two years later, he was came back, cap in hand, and tried again. This time he was frank with the board but still there was no ticket. With Sandy Street acting for him he appealed to Silver Tray who concluded that the appellant had not done enough to show he’d mended his ways. In fact, he seemed as slippery as ever: 

“The way he has presented himself to this Court shows a man who is loose with the truth and is prepared to distort the truth if he thinks it will help him. 

Often he was asked questions which he failed to answer and went off on some tangent seeking to minimise his criminality in the past. 

The evidence does not persuade me that the appellant has learned from his past experience, or that he is a person motivated to tell the truth.”

Yet even without a ticket he was still keen to practice law.

In 2010 he passed himself off as a qualified solicitor representing clients in Werribee Magistrates’ Court. The Law Institute took a dim view of this and sought to give him a spanking. 

Of course, he couldn’t very well be disbarred, so VCAT did the next best thing and banned him from acting as lay associate for a law firm. 

The board also said he’d falsified evidence to help a client get a skilled migrant visa. In support of the application, Rudy submitted a letter apparently written by the client’s employer, a cafe owner. 

Shock horror, the letter listed phone numbers, fax numbers and a PO box address all registered in Rudy’s name. And the cafe owner (who actually did exist) said he had never seen this client in his life, let alone employed him. 

Again, all this was upheld on appeal. 

Then, in 2015, Centrelink found he owed $65,557.46 in wrongly claimed benefits – this time, the single parents’ allowance. Rudy had claimed he was separated from his wife, yet according to Centrelink they were still living together in the same house with their children. 

On appeal, the Federal Court sided with Centrelink, and so Rudy was ordered to pay it all back. 

What proportion of these lapses are in the category of “spent convictions” is now in the lap of the AAT. At least the High Court has given Rudy helpful a leg-up into the credit caper. What a treat. 

Rudy Frugtniet v Australian Securities and Investments Commission