The Australian Securities and Investments Commission (ASIC) has placed interim stop orders on the product disclosure statements (PDSs) and associated advertising of two investment schemes of which Trilogy Funds Management is the responsibility entity.
The regulator’s concerns surrounding Trilogy Monthly Income Fund and Trilogy Melbourne Office Syndicate – Cheltenham include the use of headline rates of return, the lack of a clear and effective disclosure of the structure and nature of the product being offered, and failure to disclose the differences between other financial products when making comparisons with these products.
In addition, the schemes failed to address benchmark disclosures or meet disclosure principle information standards as outlined in relevant ASIC regulatory guides, and used ratings statements without providing appropriate details about the meaning of the rating, ASIC stated.
ASIC Commissioner Greg Tanzer said disclosure documents and advertisements that do not accurately represent a financial product or its keys features and risks can create unrealistic expectations and lead to poor financial decisions.
“This is especially the case when consumers are looking for lower risk products and/or higher yields in an uncertain global financial environment,” he said.
