AN AFFIDAVIT being lodged with the Federal Court today implicates the Wellington Capital boss Jenny Hutson in a bizarre scheme, involving hired actors, to ensure her company did not get removed as manager of the embattled Premium Income Fund (PIF).

The document alleges Ms Hutson was involved in an orchestrated attempt to subvert the outcome of a meeting of PIF investors, by signing up a rent-a-crowd of as many as 200 people to temporarily become PIF investors and vote in her favour.

PIF units were transferred into their names for the duration of the June 22 investors meeting so they could support Ms Hutson’s bid to chair the meeting.

According to the affidavit, a woman who identified herself as Jenny Hutson told a packed room of recruits at Sydney’s Grace Hotel: ”I need your vote to become chair.”

The crowd thought they had been called up to film a commercial for the day, according to the affidavit from a member of the unwitting group.

Ms Hutson’s identity was later confirmed by a friend of the affidavit’s author, who happened to be attending the legitimate meeting of PIF investors downstairs which Ms Hutson briefly attended.

The document details how the crowd, who were told to ”wear smart business clothes” for the ”Transfilm shoot tomorrow”, came to realise they were actually part of an elaborate charade.

According to the affidavit, after the woman identifying herself as Ms Hutson left the room, a man addressed the group saying: ”People have gotten together and were [sic] meeting downstairs and working against them. I need you to make the meeting fair because what they are doing is not fair. As a thank you, we’re giving you shares. You need to be shareholders to be part of the meeting. You’ll be required to vote to make the meeting fair.”

The affidavit reports that the ring-ins were given two contracts, one to sign PIF units into their names and another to ”sign them back over”, although they were given the option of keeping the units.

He told the acting aspirants ”we would have to sit in on the meeting and once they say, ‘Those in favour of voting Jenny Hutson as chair,’ all we would have to do is raise our pink pieces of paper’.”

The pink paper refers to proxy forms allowing the hirees to vote at the meeting.

The forms were from Armstrong Registry Services Limited, a company associated with Ms Hutson, which acts as PIF’s share registry.

According to the affidavit, the forms gave the addresses of the freshly minted PIF investors as 11/6-10 O’Connell Street, Sydney. Ms Hutson did not return BusinessDay’s phone calls yesterday but last week she denied any knowledge of the alleged shenanigans.

When asked if someone else may have arranged the rent-a-crowd for the meeting, she told BusinessDay last week: ”Anything is possible. We have lots of different pockets of interest.”

But Wellington did acknowledge last week that it set up a registry upstairs from the investors meeting after it was ”excluded from occupancy of the premises by the meeting convenors. The registry was relocated to an adjacent floor at the meeting venue. The floor in between was locked, on instructions from the meeting convenors, thereby physically excluding those who sought to register or attend the meeting through the registry services, provided by Wellington Capital.”

Disgruntled investors were also planning to remove ”poison pill” provisions in PIF’s constitution that would otherwise pay Wellington millions if it was removed as responsible entity.

The alleged scheme came to nothing as the June 22 meeting was adjourned until July 14, due to legal action launched earlier that week by Wellington Capital in the Federal Court in Brisbane seeking to have the meeting declared invalid.

The affidavit, which was lodged by the PIF Action Group, relates to this legal action, which is due to go before the court on July 6.

Controversy has dogged PIF since redemptions were frozen in 2008 on what was once a billion-dollar fund founded by Gold Coast financier, MFS. The company later collapsed amid allegations of fraud.

MFS, which changed its name to Octaviar, was already in trouble when Ms Hutson’s Wellington Capital agitated for board room representation on behalf of MFS shareholder, Chris Scott.

Mr Scott, a business colleague of Ms Hutson, later made Wellington Capital an adviser to the board, before controversially awarding Wellington lucrative management rights to PIF – MFS’s flagship fund.

Last year, an insolvency specialist, Mark Korda, told a public examination of the collapse of MFS, that the decision to appoint Ms Hutson’s Wellington Capital as manager of PIF was the ”lesser of all the evils we could have done”.

”At the time of the transaction I don’t think they were independent,” he told the court.

More recently, Ms Hutson drew the ire of PIFAG after she raised $7.55 million in a share placement with new investors at 10¢ a unit – one-tenth of what the fund’s original investors paid, and a fraction of Wellington’s own valuation of the units.

Ms Hutson said the funding – which matched the $7.55 million paid out as a dividend just weeks before – would accelerate the development of land, which PIF owns as mortgagee in possession.

PIFAG took action. It sought action from the Australian Securities and Investments Commission, took legal action to prevent the raising and a subsequent rights issue from going ahead, as well as taking action to have Wellington removed as manager.

The claims in the affidavit were independently confirmed yesterday by BusinessDay thanks to an account by another modelling extra who was enlisted to attend the meeting. ”We were given envelopes: two forms and two share certificates,” said the young person who, fearful of jeopardising her work with the MCTV agency, declined to be named.

”The transfer of shares forms had a a ‘sign here’ sticker. When we went into the meeting on George Street … the lady in the red jacket briefed us”.

The lady in the red coat told them what they were being asked to do was not illegal, ”the NRMA did it”, she said, according to the movie extra.

MCTV was unavailable to respond to the claims.