The Federal Court has ordered convicted criminal Peter Foster to pay $660,000 in penalties for his involvement in misleading SensaSlim franchisees.
The court also dished out $3.55 million in penalties yesterday to SensaSlim Australia, which is now in liquidation, after it found the business had engaged in misleading and deceptive conduct.
Meanwhile, Foster has been banned from promoting or supplying weight loss products or services for life and has been permanently disqualified from managing corporations.
The penalties come after SensaSlim was found to have made false representations in a franchise disclosure document relating to Foster’s involvement with the company.
While handing down the judgment, Justice David Yates said Foster preyed on the “right-mindedness of others to cheat and deceive”.
“He is beyond redemption,” Yates said.
The court also handed down penalties of $75,000 and $55,000 to former SensaSlim officers Michael Boyle and Peter O’Brien respectively for their role in the business’s misleading statements. Boyle has been disqualified from managing a corporation for three years and O’Brien has been disqualified from managing a corporation for 10 years.
Dr Michael Schaper, the deputy chair of the Australian Competition and Consumer Commission, said in a statement Foster went to great lengths to hide his involvement in SensaSlim from franchisees.
“His conduct was unacceptable and extremely deceitful, and the court imposed penalties to reflect this,” Schaper said.
“People who decide to buy into a franchise business typically put much of their own savings on the line. They must be able to make informed business decisions on the basis of full and accurate disclosure by the franchisor.”
Foster has served time in prison in Australia, the US, UK and Vanuatu, according to Fairfax.
SmartCompany was unable to contact Foster for comment.