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ABC News
5 minutes ago
- ABC News
Identity of NSW man behind $19m 'ethical' internet scheme horrifies customers
It was pitched as the opposite of the dark web, an "ethical" version of the internet, raising as much as $19 million from backers sold on an Australian man's promise of the "Lightweb". But after 12 years and funds from up to 2,000 "mum and dad" investors from all over the world, the Equilux Lightweb still has not launched. Many customers are now pulling out of the ambitious scheme after learning the man behind it has not been using his legal name, and that he has previously been sanctioned by the corporate regulator, the Australian Securities and Investments Commission (ASIC). The ABC can reveal that Lightweb's founder — David Stryker — is really David Dayan Sevelle, a NSW man the financial watchdog sued in 2006 for running an unregistered investment scheme that left 70 "unsophisticated" investors out of pocket to the tune of $13 million. The financial watchdog shut down the scheme and imposed permanent bans on Mr Sevelle. ASIC confirmed to the ABC it was now making "preliminary inquiries" into the Lightweb scheme. It comes as Mr Sevelle, currently residing in Thailand, has been holding weekly "meritocratic" training over Zoom, teaching his followers how to behave morally for when the alternative internet launches, while preaching that "transparency is key". Do you know more about this or have a similar story? Email The Lightweb claims to be a superior, safer version of the internet through its requirement that users verify their identity to stamp out paedophiles and other online criminals. "It was going to be a platform that was effectively impervious to corruption," said Sydneysider David Coffey, who was won over by the premise and ended up putting $160,000 into the Lightweb project. But Mr Coffey desperately wanted out as he learned more about the company's founder in 2023. "He [Sevelle] moved to Thailand, which really raised a hell of a lot of eyebrows," he said. "Then we found out about the ASIC stuff and I started to get really uneasy." Mr Sevelle declined to be interviewed by the ABC because: "We are preparing for a Website Launch [sic] and will do press releases accordingly at that time." He did send lengthy responses to questions via email. Those involved in the Lightweb scheme have not been buying shares. They have been pre-purchasing advertising slots, called broadcast certificates, for when the platform goes live. It means the venture is technically not an investment scheme, and therefore does not require a financial services licence. It also does not receive as much scrutiny from regulators. The ABC has obtained one broadcast certificate where Mr Sevelle signed off under the name David Stryker. In his statement to the ABC, Mr Sevelle said he had not lied about his real identity and was simply using a "professional name" the same way actors, writers and influencers did. He said it was a "privacy barrier" to protect "unwanted commercial IP theft attempts" and also because the digital currency industry "can be very dangerous with nefarious and bad actors". "I have never hidden behind this name and still operate my own company and register domain names and trademarks and IP under my name," he said. "I wonder if you were interviewing Marilyn Monroe [if she was alive], P!NK, John Wayne [if he was alive], Nicholas Cage, Emilio Estevez and Katy Perry and many others that you would be accusing them of being deceptive "fake namers" like you did me." An information pack that a sales agency distributed in 2017 promised massive returns on these broadcast certificates, projecting they would sell for between eight and 25 times their original price. The internal document also stated the Lightweb platform would be worth $10 billion when it finally launched. Mr Sevelle told the ABC, "We never promise a fixed rate of return", and said this document was not "authorised marketing content". "When discovered, our management team pulled the document from circulation immediately, and this led to, in part, the triggering of formal dissolution of the sales agency," he said. He went on to say he was confident "we will exceed the 25 per cent product value increase" in the future. The Lightweb program has expanded its offering and announced plans to create its own virtual currency, including one called the StrykerCoin. To date, the platform still does not have an active website or a product and missed its own most recent deadline of a May launch. Mr Sevelle said there had been multiple delays due to "outside influences" such as "limited early development funding", the COVID pandemic, and the cost-of-living crisis. He said he expected the platform to launch within 90 days after dealing with a "trademark challenge". The Lightweb project operates under companies registered in Australia, New Zealand, the UK and the US, including Create2tech Pty Ltd, Stryker Design, StrykerFusion and Stryker Design International. Mr Sevelle's third wife, Noppakao Yingnok, a Thai and Australian citizen, is registered as the sole director of these businesses. When the ABC asked Ms Yingnok questions about the operations of her companies, she said to "talk to David". Mr Sevelle said he shared responsibilities between himself, the leadership team, the consulting team, and his wife in managing the businesses and was a "key decision maker". An internal report from 2023 showed Mr Sevelle was not the director of the Lightweb business but appeared to have been making a sizeable amount of money. A company called Elleves Pty Ltd, which is "Sevelle" spelt backwards, was paid $250,000 in "consulting fees" in 2020 and 2021. Mr Sevelle is listed as the sole director of Elleves. In his statement to the ABC, Mr Sevelle said he had originally loaned money to the Lightweb companies to get them off the ground and that the $500,000 payment to Elleves Pty Ltd was an "accumulation over years" of uncharged fees. He claimed there was no direct benefit paid to him and that he was paid a salary of $50,000. Concerns among Lightweb members mounted when Mr Sevelle and Ms Yingnok moved overseas to Thailand, permanently, in early 2023. Around the same time, news of Mr Sevelle's real identity broke among his supporters, and his past was laid bare. ASIC sued Mr Sevelle in the Federal Court in 2006 for running a property venture that "made statements to clients that were misleading or deceptive" and for "improperly assisting clients to obtain loans to invest in the scheme". Mr Sevelle ran a slew of property companies, trading under the name Mega Money, operating in the Central Coast, Newcastle, Hunter Valley, South Coast and Canberra regions, with the intention of pulling together enough mum-and-dad investors to pay for stamp duty and development approvals on blocks of land, and sell them at a profit to developers. But ASIC froze the Mega Money companies by court order, and eventually they were all forced into liquidation. In an affidavit filed with the Federal Court, the court-appointed liquidator, Justin Walsh of Ernst & Young, said Mr Sevelle spent "significant sums of money" from the company on "personal purposes". Those included an $86,000 antique "sloop" yacht, moored in the Toronto Yacht Club, and also "a large number of cash withdrawals" from ATMs. "Large sums of money" also went into Mr Sevelle and his then-wife's personal house and two investment units. He was not married to Ms Yingnok at that time. Two of these properties were sold before the liquidator could lodge a caveat to protect creditor interests at the site. "The [company] accounts were replete with inconsistent treatment of recurring transactions, unexplained transactions, and fundamental balancing errors," the liquidator added. The "majority" of investors had borrowed against their homes to invest in the scheme, and many had dipped into their superannuation as well, Mr Walsh's report noted. Mr Sevelle was banned permanently through court-ordered enforceable undertakings from providing financial advice, dealing in financial products, and carrying on a financial services business, including through the promotion and operation of any managed investment scheme. Separately, ASIC also permanently banned Mr Sevelle from financial services. "It definitely affected our retirement," said a Mega Money investor from Maitland, near Newcastle. Another couple from the local area, who lost $90,000 from the property scheme, said of Mr Sevelle: "He could probably sell coal to Newcastle [like] ice to Eskimos. We fell into that trap quite easily." Mr Sevelle told the ABC that "there was no impropriety" in the Mega Money collapse and that he was not fined or charged over anything. "ATM withdrawals, antiques, jewellery, any personal purchases made were from post-income tax paid earnings for those personal purchases," he added. As Lightweb customers learned the full extent of Mr Sevelle's past, he released a lengthy statement to explain the situation and his decision to change his name. He claimed ASIC found a "glitch" in the way he ran his property companies where he was treating all his businesses as one, which meant he was over the limit of investment funds and was running an unregistered managed scheme. "I had been treated like a pariah for no reason other than one technical accounting glitch," he wrote. "I apologise I did not disclose this to you at the initial outset of the business recruitment process, but I am sure you will appreciate my position and my actions to best nurture the project. "I do not wish my name to be associated to this project till we are secure, launched and commercially sound. "I hope you can understand this explanation … Transparency is key." He signed off as "David Sevelle AKA David Stryker (professional name)." Despite the explanations, a 2023 company document showed 90 people demanded refunds from the Lightweb scheme. Customers had been promised full refunds, but Mr Coffey, the Sydneysider who put $160,000 into the Lightweb project, alleged the company was "putting up walls everywhere", including placing a limit on how much he would receive monthly. He ended up having to engage lawyers, and it took until the end of last year to get all his money back. "Our client is understandably concerned about the legitimacy of your business and ability to refund his investment pursuant to your agreement with him," the legal letter, addressed to Noppakao Yingnok and David Stryker, read. "Our client has since been advised that you will now be paying the remainder of the refund by way of $10,000 payments over 10 months. "Your company has no standing to set these repayment terms with our client. Your contract with our client provides that a full refund is available upon request." Mr Sevelle told the ABC that, for cashflow reasons, refunds of more than $10,000 could not be paid in a lump sum. "It is not prudent to do so, as we are not a bank," he said. "No-one was ever boxed into staying. No startups or scale-ups have ever refunded pre-launch that we are aware of." Mr Sevelle has previously told his customers on a video call that the Australian Taxation Office (ATO) has audited the business numerous times due to the number of self-managed super funds in the scheme. The ATO told the ABC it would not comment on specific cases or confirm if an investigation was underway. In a statement, a spokesperson said: "The ATO encourages anyone setting up an SMSF [self-managed super fund] to ensure they understand what is involved in running their own super fund, and that they are ready and able to meet these obligations." The ABC has spoken to multiple people, who did not want to be identified, who said the company's most recent sales rhetoric involved encouraging investors to mortgage their homes to obtain more money. Morgan, 26, from Newcastle, said her father was so taken with the Lightweb idea he was considering retiring early so he could put his long service leave into the scheme. His family convinced him not to, but he is now looking into mortgaging the family home. He has already put $40,000 into the scheme. "It's definitely caused a lot of tension, especially because I feel like Mum and Dad have worked so hard for everything they have, and to have someone convince my dad to hand that over, it's just mind-boggling, like it's insane," Morgan said. Barry Urquhart, 66, from Newcastle, bought $7,000 worth of broadcast certificates several years ago. When he tried to put in more money through his superannuation, he said his accountant would not authorise it. "He said it [the Lightweb] was nothing; it was just a dream," Mr Urquhart said. Mr Urquhart has since gotten his money back and reported the company to ASIC. Mr Sevelle said in his statement to the ABC that: "The truth is that if they [customers] are no longer in our organisation and they have been refunded what they were entitled to, they of course will not want us to succeed, as our success will then be their failure." "I am sorry for both you and I, that you did not see this as a bigger story of innovation, empowerment, job creation and unlimited opportunities," he said. Mr Sevelle "will dance you around like you're on Dancing with the Stars," said one Lightweb customer who did not want to speak on the record. "He likes to use so much financial technical jargon and acronyms to confuse the hell out of people," they said. Others have described Mr Sevelle as having the "gift of the gab" and went as far as saying it felt like a cult of personality. Mr Sevelle has been holding hours-long "moral" training sessions every week over Zoom for years, where he teaches his followers how to behave like "meritocrats" for when the Lightweb finally launches. Some of these sessions involve movie nights, such as watching The Big Short and Eat the Rich. "There were so many people who drank the Kool-Aid and were calling him the Messiah," said Mr Coffey, the Sydney customer who had taken his money out. "It was constantly reinforced how blessed we were to be in the company at this time of imminent launch … so we had better buy more of the upcoming new investments before it's too late," said another customer, on condition of anonymity. ASIC said it was "aware of concerns related to these entities and is making preliminary inquiries". The financial regulator added: "Speaking generally, super-switching misconduct is an increasing concern for ASIC." "We are seeing more and more reports of people being targeted by pushy, high-pressure sales tactics into switching their super into high-risk, complex schemes," a spokesperson said. "Other red flags include high-pressure sales tactics, poor or even non-existent product disclosure, and promises of unrealistically high returns." Mr Sevelle said he welcomed both ASIC and the ATO looking into the Lightweb businesses.
ABC News
5 minutes ago
- ABC News
How WA Police has improved procedures for domestic violence calls since murder of Lynn Cannon
The brutal murder of Perth mother Lynn Cannon by her estranged husband in 2022 prompted a review of how WA Police respond to family violence incidents. A coronial inquest this week found police had failed to recognise the imminent risk he posed to Ms Cannon, and downgraded the priority assigned to a call from her family, even though the family specifically warned them he had threatened to kill her. The report found police took more than an hour to arrive at her husband's Landsdale home, by which time Ms Cannon had died. Ms Cannon's family said the flawed system has now been exposed, and they do not want it to happen again. Police said they have implemented new procedures to try to prevent a similar tragedy. Here is what has changed. Police Commissioner Col Blanch said yes. The review police conducted following Ms Cannon's death examined their call-taking and dispatch procedures to identify gaps and inefficiencies, and how to better respond to similar incidents in the future. Commissioner Blanch insisted police risk assessment methods have now been overhauled. For instance, at the time, police took into account the fact that her estranged husband, Paul Cannon, did not have a criminal history of violence when deciding how to prioritise the incident. But Commissioner Blanch said that should not determine whether there was a risk. "In this case, it was a break-up," he said. "There was escalating violence and there were family members that knew that that risk was increasing. "They're the things that we look at today, and that's why it would have a much greater priority when police deploy today." Commissioner Blanch said no. Family and domestic violence call-outs accounted for some 65,000 police jobs in 2023. Lynn Cannon's case was originally allocated a Priority 2, following her sister Christine Holmes's call to police. That required police to attend the scene within 12 minutes — but the officer on duty downgraded it within two minutes to a Priority 3, which required police to attend the scene in 60 minutes, and police were then sent to Ms Cannon's home instead of Paul Cannon's house, where she actually was. Mr Blanch said a similar downgrade would not happen today because one person could no longer make that call, and only a senior sergeant or above could authorise a downgrade. A downgrade could also only be approved "if circumstances of the incident changed". The coronial inquest was told that police had now revised the definitions for incident types and dispatch priorities. According to police, that would mean the information provided by Ms Holmes, that there was a risk of injury to Ms Cannon, would likely cause a call taker to give the job a Priority 2 response. Police must now also inform callers of their approximate response time and tell them if the matter is downgraded and there is a new response time. This would have been vital for Ms Cannon's family, who advised the inquest that if they had known the police response time would be so long, they would have sent a family member to check on her. WA Police now have dedicated family violence sergeants, whose role is to oversee and review all family violence tasks to ensure "these incidents are correctly classified and prioritised". Coroner Sarah Linton found in her inquest report that information sharing between agencies and consistency in their responses were key parts of changes underway in WA's family and domestic violence system. This is critical because it will allow police and other agencies to create a more comprehensive picture of the risks facing a victim-survivor. A professor of social work at Curtin University, Donna Chung, and Centre for Women's Safety and Wellbeing chief executive Alison Evans advised the coroner during the inquest. In Paul Cannon's case, there was no recorded history of prior violence. In their report to the coroner, Professor Chung and Dr Evans pointed to "the importance of obtaining anecdotal history from family members" and other people in the victim-survivor's support network. The coroner found "weight needs to be given to this historical knowledge". Professor Chung is helping WA Police establish an algorithm that creates a risk score for potential perpetrators to inform the urgency of calls. The idea is to create a database centred on the actions and information of perpetrators, and Professor Chung said the software would need information to be shared from different agencies, including health. "We use the information that we've got available but also keep advocating for specific items of data to be shared with police so that police can more quickly identify who of those are most likely to cause harm," she said. In the conclusion to her coronial inquest report, Ms Linton stated: "Every person in the community has a role to play in putting an end to family and domestic violence." She said each person must "be able to say with confidence": As former corruption and crime commissioner John McKechnie noted, it would take a "fundamental change in the community attitude to domestic violence". That means recognising, as the coroner said, that domestic violence is a matter of grave national concern and that WA consistently has one of the highest recorded rates of family and domestic violence in the country. Dr Evans said driving cultural change was vitally important, but should not distract from helping women manage the violence being directed towards them. "It is mostly boys and men, by a vast majority, who are causing the harm to women," Dr Evans said. "There is quite a focus on how we work with men and boys to ensure that they have attitudes and demonstrate behaviours that are respectful towards women and children. "But even if we put all of our resources and effort into that cultural change, that will take time, and in the meantime, we can't be leaving women and children to be managing men who are using violence towards them. 'We must not take our eye off what women and children are currently living with."
ABC News
5 minutes ago
- ABC News
Perth Royal Show organisers won't reveal Working with Children Check rules after sex offender scandal
Perth Royal Show organisers are refusing to confirm if Working with Children Checks will be mandatory for exhibitors at this year's event, following revelations a convicted child sex offender was spotted there last year. Last year, the ABC revealed a convicted child sex offender was seen by his former victim's mother at a popular pavilion performing a demonstration for children. She called on show organisers to tighten their screening processes and implement Working With Children Checks (WWCC) for all workers and volunteers, including commercial exhibitors. Following the incident, the Royal Agricultural Society of WA (RASWA) pledged to work with WA Police and the Working with Children Screening Unit to review its practices. But now, less than two months out from this year's Perth Royal Show, RASWA has declined to say whether exhibitors will now be required to have the WWCC clearance, other than to say they are "fully compliant" with the relevant legislation. RASWA also told the ABC they were compliant with the legislation last year, when the paedophile was identified. A working with children check is compulsory in Western Australia for people engaging in child-related work. But it's not clear whether all exhibitors, workers and volunteers at the Perth Royal Show are captured by the current rules, although "children's entertainment" is defined as child-related work by the WA legislation. The convicted child sex offender working at last year's Perth Royal Show would not have been eligible for a WWCC clearance in WA due to the serious nature of his historical offending. In a statement, the RASWA told the ABC they had "implemented increased screening and background checks" this year, but declined to provide any detail on what this involved. RASWA said registered sex offenders were "prohibited" from working and volunteering at the show but again failed to detail how they would prevent this from happening. The organisation said it does require the WWC checks or national police clearance for people who work or volunteer directly for their organisation but failed to clarify, when asked directly, whether this policy also applied to commercial exhibitors who run stalls and demonstrations. RASWA said "background checks are just one strategy in place to ensure a safe and secure environment for all attendees". The statement said some of the details were "operationally and commercially sensitive" but they also deployed: The RASWA also declined a request for interview with the ABC. Adverts for some positions at the Royal Show seen by the ABC, including for ride operators, showbag sellers and Sideshow Alley attendants, state applicants must have no criminal history and be able to provide police clearance "if requested". The Perth Royal Show saw 438,000 attendees last year, with the state government providing free tickets to around 145,000 children under 15. The ABC approached the Agriculture and Child Protection ministers to ask whether they had been briefed on the outcome of RASWA's review into its screening processes. A state government spokeswoman said WWCCs were an "important tool to protect children" but only individuals engaging in child-related work as defined by the Working with Children (Screening) Act were required to hold the clearance. "The State Government supports efforts by the Royal Agricultural Society of Western Australia to strengthen its policies and procedures to ensure the safety of children remains the top priority," the statement said. "Organisations and individuals who allow or engage in child-related work without a valid WWC Check can face penalties of up to $60,000 and five years jail." The organisers' failure to provide more detail to parents comes amid heightened focus on the country's working with children screening process, after a man who had worked for about 20 childcare centres in Melbourne's south-west was charged with more than 70 child sex offences. A subsequent investigation by the ABC found that man held a Working with Children clearance, prompting Victoria to strengthen its laws around how the scheme is administered. Institute of Child Protection Studies director Professor Daryl Higgins said mandatory working with children checks were important and would "remove any doubt" at events involving families and potentially unaccompanied children. "[Royal agricultural shows] should have the same responsibilities as every kind of child-serving organisation in Australia," he said. "That means that all staff and all volunteers need to be appropriately screened, but also … inducted and kept accountable for supporting and following child-safe policies." Professor Higgins urged states and territories to adopt a nationally consistent Working With Children Check regime and to legislate child safety standards, part of the recommendations handed down by the Royal Commission into Child Sexual Abuse. "The important thing about legislating child-safe standards is that it makes it really clear who does need to have working with children checks," Professor Higgins said. "It applies to any organisation who is running services for children, and so it kind of takes that guesswork out of it." ACT for Kids, a support service for children and families who have experienced trauma, agrees WWCC should be mandatory for any adults who may have unsupervised contact with children. "I think it's important that employers and organisations take responsibility for kids' safety," executive director Tom McIntyre said. "One way of doing that is, as part of an employment arrangement … check the person's appropriateness to work with children, who are obviously vulnerable in those situations." Body Safety Australia, a national organisation providing training and education aimed at preventing child abuse in care and educational settings, says WWCC are only one mechanism to prevent harm and for organisations like Royal Shows, applying them could be complicated. "The question is … whose care is the child in? If the child is in the care of their parent or guardian whilst they're attending something, then the parent or guardian is responsible for the child in that space, chief executive Deanne Carson said. "But if the child is in a care of an entertainer or somebody who is working at a festival or a show, then absolutely that person should be properly vetted." She also called for all states and territories to mandate child-safe standards, outside of WWCC legislation. "I think when we look at big child events like royal shows across the country, we need to think about all of the ways that we can strengthen child safety in those spaces," Ms Carson said.
