The Federal Court has appointed receivers to the Australian division of United Kingdom pension specialist Brite Advisors.
Following a three-day hearing, the Federal Court made orders appointing Linda Smith and Robert Kirman of McGrathNicol as corporate receivers and managers of Australian financial services licensee Brite Advisors Pty Ltd on 13 December and reaffirmed asset preservation orders obtained by the Australian Securities and Investments Commission (ASIC).
The receivers are tasked with conducting further investigations into Brite Advisors and the approximately $1 billion of client pension funds under its management, and are due to report to the court and ASIC on their investigation within 42 days.
ASIC initially raised concerns over activities conducted by Brite Advisors after it failed to lodge its financial statements and auditor’s report for 2021/22, stating its financial position was unknown at the time.
Subsequently, the corporate watchdog successfully obtained court orders to freeze the assets of the financial services firm after an application to the Federal Court in Perth in October. The court remade the asset preservation orders to protect client assets, but has enabled the receivers to carry on the operations of Brite.
The court acknowledged issues raised by ASIC regarding Brite Advisors, highlighting a $100 million discrepancy in client funds, which remains unexplained in the company’s financial reports, and concerns over the management of the firm.
The regulator has conducted the investigation, which is ongoing, with assistance from the United States Securities and Exchange Commission, UK Financial Conduct Authority, Gibraltar Financial Services Commission and Hong Kong Securities and Futures Commission.
Brite Advisors operates in multiple countries, including the UK, US, Hong Kong and Australia, providing advisory, pension administration and asset management services.
The pension specialist also offers an investment platform to self-invested personal pension providers, qualifying recognised overseas pension schemes and SMSFs.