Call for ASIC action against ACR

A group of investors who lost money in the failed property firm Australian Capital Reserve (ACR) is calling for the Australian Securities and InvestmentsCommission (ASIC) to pursue legal action against ACR for compensation.

Noteholders Action Group member Peter Miller has written to administrator Greg Hall of PriceWaterhouseCoopers (PWC) to request that PWC petition ASIC to pursue a “section 50 public interest case” against ACR.

In his open letter to Miller, a copy of which he sent to Money Management, Miller reminds Hall that PWC made a similar successful petition to ASIC earlier this month to pursue legal action on behalf of Westpoint investors.

Currently, PWC — also administrator to Westpoint — is “holding back $5 million of ACR Noteholders’ money to pursue litigation against the valuers and auditors of ACR”, Miller writes.

“Will you, as liquidators for ACR, be asking ASIC to launch legal action on behalf of ACR investors against ACR, which, like Westpoint, should fall into a ‘section 50 — public interest’ case.

“If the answer is in the negative, can you comment on any possibility that an action under Section 50 of the ASIC Act may arise in the future with regard to ACR?”

In his letter, Miller also referred Hall to comments by ASIC chairman Tony D’Aloisio that the administrator believed there was “a clear public interest in using ASIC’s powers to pursue compensation for Westpoint investors”.

“As an ACR Noteholder, I believe that the same response from ASIC should apply to ACR and to ACR investors,” he wrote.