The early victims of Melissa Caddick: ‘Forever’ friend, former boss, ex-husband

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Melissa Caddick hasn’t been seen since November 12. Picture: Stuff.co

How did one woman come to rip off her family and friends to the tune of A$30 million (NZ$32.2m)? The seeds of her undoing were planted long before the fraudulent financial scheme that brought her unstuck.

Is there anything else I need to know?” the investment chief asked with cold fury. Before him stood his well-groomed office administrator, Melissa Caddick (then known by her maiden name of Grimley), who had just been confronted with the evidence of her crimes: four cheques on which she’d forged his signature. Caddick shook her head.

It was 1998, and Caddick had landed a job running the Sydney office of a recently opened boutique investment house via a friend she’d worked with at the NRMA.

Her boss recalls his assistant as being organised, efficient and reliable. Although there were only the two of them in the office, she dressed immaculately. “Her manicured presentation seemed suited to a job she aspired to, rather than the job she had,” says the former boss.

After Caddick had been there about six months, someone from the firm’s interstate head office queried discrepancies showing up between invoices and payments.

When copies of the cheques for the suspicious payments were located at a National Australia Bank branch in Pitt Street in Sydney’s CBD, it became clear that Caddick had been forging her boss’s signature.

Shown the cheques, a look of “I’m done” crossed the then 27-year-old’s face. “We can escalate it or you can leave immediately,” he offered.

Caddick made a hasty departure, packing her personal belongings into her designer handbag.

“It was a clean exit, no lawyers, no police, no nothing,” her former boss says. She’d stolen a petty amount, less than A$2000. She didn’t offer to repay it – and rather than going to the trouble of calling the police, the firm didn’t ask her to. It was just happy to see the back of Melissa Caddick.

That, with hindsight, was a crying shame: a criminal record might have forestalled what was to come.

The case of Melissa Caddick and her missing millions has transfixed not just the eastern Sydney suburbs that was her milieu but the wider Australian population, ever since it emerged in November 2020 that the 49-year-old had been running a Ponzi scheme.

Between 2012 and 2020, Caddick had convinced more than 60 people to entrust a combined $30 million of their savings to her sham wealth management business, Maliver, none of which she was actually investing on their behalf. Of the A$30 million, only about A$7 million was returned to clients, leaving as much as A$23 million unaccounted for.

While it is not yet clear exactly where all those millions ended up, the old adage, “You have to act rich to be rich”, was one Caddick took to heart.

Using the initial proceeds of her crimes, she bought designer clothes, expensive jewellery, European cars and a fancy house, and took her family on luxury holidays several times a year. The ostentatious trappings of wealth cloaked her in a chic veneer of success.

She made herself appear more exclusive by telling potential investors that her books were full. She’d call later to say they were in luck – a place had become available.

Clients were sent a seven-page Maliver Financial Services Guide in which Caddick promised to “maximise client outcomes while working within the law”.

Instead, she was breaking the law by operating a financial services business without a licence. Under the heading “YOUR ADVIER’S [sic] EXPERIENCE & QUALIFICATIONS”, Caddick also lied about her achievements, including that she had a master’s of business and was a certified member of the Financial Planning Association of Australia.

Once accepted, investors deposited money into Maliver’s Commonwealth Bank account. For each new client, she then created a bogus CommSec share trading account, these fake accounts featuring six-digit numbers where the genuine CommSec account numbers have eight.

Not only did she forge her clients’ signatures where required, but when a Justice of the Peace was needed to witness that other signatures were genuine, she also forged the signature of her father-in-law, Rodo Koletti, a JP.

Using a cut-and-pasted CommSec logo, at the end of each month she emailed her investors a report. The shares in which she “invested” her clients’ funds never made a loss. Instead, they showed a dazzling return, sometimes up to 30 per cent a month.

Buoyed by such returns, investors would put more money in and, via word of mouth, talk of Caddick’s impressive returns spread.

Most of her victims were her family and friends, many of whom lost their life savings. She cheated her doting parents Barb and Ted Grimley, her older brother Adam, her aunts, uncles and cousins.

She ripped off friends she’d had from childhood, along with their families, her personal trainer, her two employees and a group of Perth surgeons, one of whom was a university friend of her brother.

The first thread in the unravelling of Melissa Caddick’s world appeared in November 2019, when the Australian Securities and Investments Commission (ASIC) received an anonymous tip-off that a Melissa Caddick from Dover Heights in Sydney’s east was operating a financial services business using someone else’s Australian Financial Services Licence.

Caddick knew it was illegal to operate without such a licence, which can attract a A$22,000 fine and two years’ jail, and lacked the requisite qualifications to apply for one herself. Her solution had been to ask a former work friend if she could use hers.

The friend said no but Caddick had gone ahead and used it anyway. Unaware that this was happening, the friend continued a working arrangement with Caddick in which Caddick referred clients to her friend for insurance broking services. Indeed, Caddick’s own life insurance was done through this person.

“I found out when a potential client of Melissa did some due diligence on the documents they were provided,” the friend says of her discovery that Caddick was using her licence.

“ASIC was immediately notified.” When pushed as to the exact date this occurred, she replies: “This is a question for ASIC.” It’s a question the corporate regulator also declines to answer, leaving open the issue of just who tipped them off in November 2019.

Whoever it was, with no mention of fraud or misappropriation, and hundreds of other complaints to assess each month, ASIC recorded this single, unsourced complaint about Caddick operating without her own licence, but took no action.

Seven months later, on June 3, 2020, another complaint arrived at ASIC – this time with more detail. With rising alarm, investigators realised they were dealing with something huge.

Concerned that Caddick might get wind that they were on to her, they decided to make a pre-emptive strike. Thus on November 10, 2020, they made an urgent application to the Federal Court to freeze her assets and seize her passport.

The application was granted, and the following day the Australian Federal Police raided Caddick’s home in Wallangra Road, Dover Heights. In the 12 months since the initial, unheeded tip-off, Caddick had pocketed A$7.8 million.

Only a month prior, Caddick had invited herself to the 50th birthday party of one of her oldest friends, Joanna (not her real name). Because of Covid-19, it was a quiet affair, just family and a couple of friends, held at the St George Motor Boat Club at Sans Souci in Sydney’s south.

Caddick’s vivid outfit at the low-key event was the subject of much discussion. Joanna and her daughter were shocked when they later discovered the Dolce & Gabbana dress she’d worn had cost A$2500. Caddick presented her friend with a bottle of expensive champagne and a Christian Dior scented bathroom deodoriser.

“I remember being really happy that night, thinking how lucky I was to have a friend that I have known forever,” Joanna says. “Looking back, she was ripping off everyone at my party. Every single member of my family plus another couple I had invited.” All up, Joanna’s family was stung for about $10 million.

“Great xx” was the last thing her childhood friend heard from Caddick. At 6 am on November 11, the Federal Police had shocked Caddick, her husband and her 14-year-old son when they arrived at their home bearing search warrants.

Over the next 13 hours, she watched as an endless parade of her precious clothes, handbags, shoes and jewellery was taken away. Despite the tumultuous events, when Joanna texted her suggesting a lunch date with their mothers, Caddick had texted back the single-word reply and two kisses.

At 5.30 am the next morning, Caddick’s son heard the front door close. She’d left in her running gear, her husband told the police, but taken nothing with her. Melissa Caddick was never seen alive again.

On February 21 this year, campers at a remote beach on the South Coast of NSW found a running shoe containing human remains which were later identified as those of Caddick.

Although the New South Wales Coroner is yet to make a ruling on her fate, police believe that within hours of the raid, Caddick threw herself off the cliffs only 150 metres from her home.

Melissa Louise Grimley was born on April 21, 1971. Hers was a comfortable, middle-class family, with her father working in reinsurance and her mother, the driving force in the family, a secretary in a physiotherapy practice. Their house in Lugarno, in Sydney’s south, was surrounded by bushland and backed onto the Georges River.

Caddick was an ordinary girl. At Lugarno Public and then Peakhurst High, there was nothing about her that stood out. Rather than being the numerical whizz she would later claim to be, she undertook the lowest level of maths for her Higher School Certificate.

Her ambition to be a ballerina was stymied by her body type, which was short and stocky. She was conscious of fashion labels even back then, according to Joanna. “She always had that desire to be better than she was – even from primary school. She always aspired to be in the coolest group.”

After leaving school, Caddick enrolled in a secretarial and business administration course at Patrick’s College Australia (PCA) in the city.

Established in 1923 by the Sisters of Mercy, the college’s original aim, according to its website, was “to help young women gain employment in Sydney’s corporate world by training them to be personal assistants and legal secretaries”.

To this day, PCA aims to help graduates land their perfect job, equipping them with “Modern Business Etiquette and Deportment, Dress Sense, and overall Professional Prestige”. Along with acquiring a dress sense for the life she wanted rather than the life she had, Caddick also seems to have taken the college’s Latin motto to heart: Aut Optimum Aut Nihil – Either the Best or Nothing.

Her first job after secretarial college was in administration at NRMA’s investment division. “She would get very, very cranky if you said, ‘Here’s Melissa, she’s a secretary,’ ” Joanna recalls, noting that her friend tended to give herself a superior title. “She always felt she was so much more than that.”

In her early twenties, Caddick was left emotionally and financially devastated after a romance scam. She was still living at home in Lugarno when she began dating a man she’d met at Friday night drinks in a pub in the city. “Money and various things were going missing from the family home,” recalls Joanna.

The private investigator hired by her parents discovered the man was a con artist who had previously preyed on naïve young women. “When they confronted Melissa with this, she went berserk,” recalls Joanna.

“She didn’t believe them and ran away with him.” Her brother Adam rang Joanna begging her “to try to talk some sense into Melissa”. She thought it best to let her friend work things out.

Not long after, Melissa returned home. “He’d maxed out her credit cards,” Joanna says. “He’d got what he wanted and didn’t need her any more.” Caddick was distraught and is believed to have suffered some kind of a breakdown. But while she’d learnt a valuable lesson, it wasn’t the one her friends and family imagined.

A couple of years later, in 1998, she left the boutique investment house mentioned earlier after being caught forging her boss’s signature on cheques. At this point Caddick turned her attention to losing weight and getting fit. Her personal trainer introduced her to another of his clients, a well-regarded financial adviser who was looking to train someone up as an office manager at Wise Financial Services.

Caddick, he recalls, was “bubbly [and] super-efficient”. After a couple of years she did the requisite training to move into financial planning.

“She did brilliant work, the clients loved her,” he says. In 2002 Caddick borrowed A$750,000 to buy a 25 per cent stake in the business, which was majority owned by global banking giant ING.

Melissa Caddick had found her niche. In 2003 she featured on the cover of trade magazine IFA (Independent Financial Adviser). Wearing a red jacket and her trademark fire-engine red Chanel lipstick, Caddick would have been thrilled with the headline: “A Wise Choice: Australia’s best planning practice.”

Another magazine featured Caddick’s eight “golden rules” for finding the right adviser. “Like any profession, financial planning has unscrupulous operators,” she warned in 2004. She cautioned against pyramid schemes and said “no matter how great a deal might look”, it was vital for potential investors to check that their financial adviser was accredited, qualified and ethical.

The next time she featured in IFA, some 17 years later, it was for catastrophic breaches of her own advice. “Melissa Caddick – the sole director of wealth management business Maliver – has been barred from removing assets held in Australia and from leaving the country as ASIC investigates concerns that she was providing financial services without an AFSL [Australian Financial Services Licence], had used another company’s AFSL without authorisation, and had misappropriated investor funds,” the magazine wrote in December 2020.

Back at Wise Financial, it was Caddick’s failure to grasp the importance of compliance and ethics that would prove to be her undoing. Caddick wanted to be able to recommend property and shares in which her clients could invest. Due to strict compliance rules and concern that professional indemnity insurance would be voided if bad advice was given about shares or property plays, financial advisers could only recommend managed investment funds to clients.

Caddick lost the ensuing battle to be allowed to recommend shares to her clients. Leaving Wise in December 2004 amid tears and recriminations, she told friends she was “done” with the industry. Happily signing a five-year non-compete clause, she recouped her original $750,000 investment and left the firm’s St Leonards office in northern Sydney.

One of her subsequent victims, Cheryl Kraft Reid, recalls asking Caddick how a financial planner could possibly afford the extravagant life she led. Caddick spun a lie that she’d departed Wise with A$86 million for devising a program to manage superannuation funds and selling it to major financial institutions.

Now that she was independently wealthy, she was offering her investment services “to help people”, she told Kraft Reid. Another friend, who knocked back Caddick’s repeated offers to invest with her, was told a different falsehood: that she’d received a massive payout from Wise Financial following a successful sexual harassment suit.

 

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