The Australian Securities and Investments Commission (ASIC) has taken further action against a managed investment scheme (MIS) operator that targeted SMSF investors, with receivers appointed to two related entities.
The corporate regulator stated that following an application, the Federal Court had ordered that Matthew Charles Hudson and Terry van der Velde of SV Partners be appointed receivers to the property of SRI Fiduciaries 2 Pty Ltd and SRI Fiduciaries 3 Pty Ltd, and also made orders to freeze their assets.
SRI Fiduciaries 2 Pty Ltd and SRI Fiduciaries 3 Pty Ltd are related entities of Australian Fiduciaries Limited, which is an Australian financial services licensee based in Queensland and the responsible entity of three registered MISs – the Global Diversified Alpha Fund, Global Multi-Strategy Fund and Global All Seasons Fund.
In June, ASIC applied for court approval to preserve the assets of Australian Fiduciaries and 30 related entities, stating 600 Australian retail investors had invested around $160 million in MISs offered by Australian Fiduciaries since February 2020, predominantly via SMSFs.
The orders, made on 4 September, follow a previous appointment on 2 September of the same receivers and the making of similar freezing orders to six other related entities. Under the orders, the receivers are to conduct investigations into how those funds were used and provide a report to the court within 45 days.
As a result of this latest court action, Australian Fiduciaries and its 30 related entities are now either in liquidation, subject to court orders or undertakings to preserve assets, or have court appointed receivers.
ASIC stated its investigation into Australian Fiduciaries, which ceased distributing units in the schemes in September 2023, is continuing and it is looking at inadequate management of conflicts of interest, the methods by which investors were sold units in the schemes and how their funds were invested into the group of entities controlled by related parties, a suspected failure by Australian Fiduciaries to conduct regular valuations of its schemes and the loss of value in the underlying assets.
