Australia’s corporate regulator has temporarily stopped new offers in the Murdoch Clarke Mortgage Fund after identifying concerns in the scheme’s product disclosure statement.
The interim order prevents Murdoch Clarke Mortgage Management Ltd from offering, issuing, selling or transferring interests under the statement while the Australian Securities and Investments Commission considers the disclosure. ASIC said its concerns include the treatment of related-party transactions, the presentation of fees and costs, the clarity and sufficiency of risk information, and the account given of withdrawal rights.
The registered scheme reported net assets of A$573.2 million at June 30. It lends against property in Tasmania. ASIC’s action does not amount to a finding that the manager has contravened the law or that the fund’s loans are impaired.
Interim stop orders are protective measures. They can be made without a prior hearing where the regulator considers that disclosure may be defective, but the issuer must be given an opportunity to make submissions. ASIC may revoke the order, allow it to expire or replace it with a final stop order after considering the manager’s response.
Existing investors are not, by the terms of the announcement, directed to dispose of their interests. The immediate legal effect is narrower: the manager cannot continue the specified offer activity while the order remains in force.
