From banking ezine The Sheet:

The Key Result, a funny money mortgage repayment scheme with some
originality and hopefully few victims, failed at the end of last month.
The funds owed to groups of investors in the scheme and trade creditors
are not clear, though probably slight.

ABC’s Inside Business
program yesterday disclosed the existence, and collapse, of the scheme,
which appears to have been centred in Melbourne and marketed
aggressively around the Samoan and other Pacific Island communities.

mechanics of the scheme appear to be that The Key Result persuaded
existing home owners with plenty of equity to gear up their loan and to
advance those funds as a home loan to another borrower (in a cheaper
suburb). The Key Result in some fashion controlled the entire expenses
of this second borrower who was in effect repaying the loan of the
first borrower. The borrowers of this second category of home loans
pledged most or all of their income to the scheme.

equity-rich investors extending their mortgage to so-called home buyers (to
use the marketing terms used by the scheme) each appear to have agreed
to a price in advance at which the “home buyer” would buy the investment
property from the “investor.”

The “investor guide” published by
The Key Result at its website (which is still operating) is pretty
vague on the detailed operations of the scheme and funds flow. A list
of “frequently asked questions” includes some unusual assertions.

Key Result’s answer to the question, “What happens if the purchaser
defaults within five years?” was that “there are a number of safety
nets and support vehicles in place to ensure very few (hopefully nil)
serious defaults. The worst case scenario is that the weekly income
going into [the investor’s] account will come from a different source!
The investor has agreements with The Key Result that for five years
they will receive a set amount of income in their bank account every

And then in answer to a second question, “How can The Key
Result guarantee the income for five years?” the promoters contend that
“the home buyer is under ‘money management’ for the full five years.
The buyer not only pays the [loan] payments but also adds to this
savings amount weekly. If the buyer defaults those savings
automatically revert to The Key Result, which are used to cover the
investor’s payments until a new buyer is substituted.”

This answer concludes that “a full default will never happen.”

The website of The Key Result lists a Peter Scully as managing director and an Alan Scully as national operations manager.

not clear when The Key Result began trading, though the company
registration dates from early 2003. The meeting of the committee of
creditors last month makes it clear that “investors” were in receipt of
letters from Terry Scully in April this year that there was a need to
“prop up” The Key Result, with profits from a Ballarat housing
development intended to be a source of funds.

The directors of The Key Result appointed Worrells, a specialist insolvency practice, as administrators in early September.