THE disclosure-based regime to regulate managed investment schemes (MIS) faces further criticism after it emerged the Australian Securities and Investments Commission (ASIC) backed the record of Great Southern Plantations only months before it collapsed.
In a letter sent in late December responding to a complaint from federal Greens senator Christine Milne about Great Southern, the regulator said the company's financial reports had been audited without any issues being raised.
The letter from ASIC pointed to Great Southern's profit after tax of $12.9 million for the year ended September 2007 and its assets of $329 million, dismissing concerns by Senator Milne that the company was functioning as a Ponzi scheme, The Australian Financial Review reports.
The Perth-based group buckled in May under more than $800 million in debt, leaving about 43,000 investors in limbo, with $1.8 billion tied up in the failed managed investment scheme operator.
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