In a statement released today, the Australian Securities and Investments Commission revealed it has made submissions to the court this week seeking orders that the LM First Mortgage Income Fund, of which collapsed LM Investment Management Limited (LMIM) is responsible entity, be wound-up.
It is also seeking orders that registered PricewaterhouseCoopers liquidators be appointed as receivers of the fund.
The regulator said it is intervening in the matter in order to avoid lengthy litigation proceedings.
“ASIC took this action as it believes that the appointment of receivers to the FMIF will allow the winding-up to proceed in the most efficient and cost effective way to provide the best chance of achieving the maximum return for investors,” ASIC Commissioner Greg Tanzer said.
“As such, ASIC believes that the persons responsible for winding-up the FMIF should be appropriately independent.
“It is ASIC’s view that the protracted litigation surrounding the FMIF is not in the best interests of investors and wishes to see the matter resolved as soon as possible.”
It emerged earlier this year that the $3.1 billion LMIM was entering voluntary administration as it could not pay a number of creditors.
A spokesperson for LMIM told ifa in March that the four risk advisers who operate under its AFSL do not write any business for its funds and would therefore not be affected by the administration.
LMIM had been gouging excessive fees for far too long. FTI also have a snout in the same trough, at LM’s invitation when the ongoing scam became to obvious to all.
ASIC have eventually done the right thing for investors, but 4 years too late! ASIC should have shut them down when LM first declared the funds illiquid (bust?) and refused to make redemptions or distributions.
It’s now clear that the last thing investors need in any troubled fund is an RE sitting on it purely to milk the fees. We can also do without parasitic IFAs waiting for their trailing commissions. It’s not difficult to see which gravy train some of the replies below come from.
You’re on a roll now ASIC, lets have you next taking action against the IFAs who miss-sold all those recent investors into the LMMPF.
Come-on, the real issue is the same LM managers that were charging +5% on the LM funds all this time, whose underwritting was so bad 100% of the loans defaulted and more recently blew-up the MPF fund ( maybe a fews cents in the dollar final recovery for the MPF investors if you are lucky) are the same team working along side FTI to wind-up the FMIF. If you still want those clowns continuing to add value then I’d love to start smoking what ever it is that you are smoking.
Jorgan, I agree 100% with your comments except the the last statement should really read [b]’Arrogant in its Ignorance'[/b]! Under what compliance and regulatory regime does ASIC operate that its behaviour is not subject to the same scrutiny as ours? For goodness’ sake!
Another idiot move by ASIC – from incapable to utterly incompetent! We have inherited a couple of clients with this and have investigated thoroughly. Whilst the current financiers (Deutsche Bank) and current administrators are managing the process there is a chance that investors will finally get something back. By attempting to interefere in a matter that does not involve them directly, ASIC in it’s ignorance will simply ensure duplication of costs, inefficiency, higher fees and a charter of not caring for investors by new receivers. I would then question what is ASIC’s primary responsibility, if not for the protection of wealth of the everyday Australian investor or consumer. Hopeless, ridiculous and ignorant in it’s arrogance.
There is a Voluntary Administrator in control of the funds already. They are subject to ASIC scrutiny. There has been no comment to date that they are not doing the job appropriately. What basis could ASIC have to simply change registered liquidators and duplicate costs in the transition?