Managed investment scheme operator, PE Capital Funds Management, has been ordered into liquidation by the Federal Court for breaching the law and operating managed investment schemes without an Australian Financial Service (AFS) licence and engaging in “misleading and deceptive conduct”.
According to the Australian Securities and Investments Commission (ASIC), PE Capital had used the money raised by its managed investment schemes to fund eight mixed-use commercial and residential projects in Victoria.
“When raising funds into its managed investment schemes, PE Capital Funds Management made misleading and deceptive statements representing that it was authorised to operate the schemes when it was not.
“It also made misleading and deceptive statements about how the investments would be structured, telling investors they had preferential securities when they did not, and in the case of one fund misrepresented the investment strategy that would be used,” ASIC said in the statement.
Following this, the Court found that over $16 million was invested in the registered and unregistered managed investment schemes and that there was good reason to believe that these schemes were insolvent.
In ordering the liquidation, Justice Cheeseman, stated: “I am satisfied that it is in the public interest to wind up PE Capital Funds Management for the purpose of protecting investors and potential investors. Winding up PE Capital Funds Management will also serve to condemn the past breaches of the Act by PE Capital Funds Management.”
PE Capital Funds Management operated the following managed investment schemes, which the Court also ordered be wound up.
- PE Capital Monthly Yield Fund, and its three sub-funds, the PE Capital Commercial Property Income Fund, the PE Capital Asia Diversified Income Fund and the PE Capital Asia Wholesale Opportunities Fund;
- PE Capital Master Fund;
- PE Capital Property Development Opportunities Fund (P1 Fund);
- PE Capital Property Development Opportunities Fund (P3 Fund);
- PE Capital Asia Wholesale Diversified Income Fund; and
- PE Capital Asia Wholesale Opportunities Fund.
The PE Capital Monthly Yield Fund and its three sub-funds and the PE Capital Master Fund were all registered, while the remaining schemes were unregistered.
Andrew Fielding from BDO has been appointed as liquidator of PE Capital Funds Management and the schemes listed above.
