A fund banned from promoting allegedly misleading debenture products has called for an urgent meeting of IPO Wealth Fund unitholders to discuss its future after receivers were appointed in May.
In a media release from IPO Wealth's parent Mayfair 101, the company claims more than two thirds of the shareholders have confirmed their support for a unitholder meeting to be convened.
Mayfair 101 claims a detailed assessment submitted by the trustee for the fund Vasco Trustees contains statements "which will be vigorously challenged".
"Every allegation made in the receiver's report and various affidavits can and will be answered in full," says Mayfair 101 Group managing director and founder of IPO Wealth, James Mawhinney.
"We take these allegations very seriously and will continue to defend our position.
"We are grateful to have the support of so many unitholders and are taking all necessary steps to ensure investor capital is protected and returned."
Receivers were appointed to IPO Wealth Holdings, a division of Mayfair 101 that manages the $82 million IPO Wealth Fund, by Vasco Trustees after two repayments were missed.
The AFR reported that these missed repayments were worth $3 million, and followed the freezing of redemptions for investors last month.
When receivers were appointed on 25 May, Mayfair 101 described Vasco's measure as "premature and imprudent" and highlighted the economic conditions faced by the fund during the COVID-19 pandemic.
"Vasco Trustees Limited appointed receivers without the consultation of the Investment Manager, IPO Wealth Pty Ltd, and no attempts were made to understand the steps that are currently being undertaken by the Mayfair 101 Group to protect its investors and portfolio companies," said Mayfair 101 in a statement at the time.
Today Mayfair 101 has doubled down on its fund being a good actor in this situation, claiming the IPO Wealth Fund "had an impeccable track record of meeting investor target returns in full and redemption requirements since its launch".
"The loan has never been in default prior to March 2020, the same month that COVID-19 caused significant liquidity issues globally," says Mayfair 101.
Vasco Trustees has been contacted by Business News Australia to verify the claims made by Mayfair 101 but no response has been received at the time of writing.
This development is the latest in one of three battles being fought by Mayfair 101, and follows the corporate watchdog applying pressure on Mayfair 101 over allegedly misleading advertisements for its debenture products.
The Federal Court restrained Mayfair 101 from promoting its debenture products and prohibited the company from using specific words and phrases in its advertising in April 2020.
As a result, the fund has raised alarm bells about its revitalisation project at Dunk Island, saying the ASIC action had the potential to delay or halt the project.
"The proceedings brought by ASIC seek to inject Mayfair 101 from issuing two of its key financial products," said a Mayfair 101 spokesperson.
"If they are successful in doing so, this will delay Mayfair 101's ability to raise capital to progress the project in line with its original timelines. We are confident that our case is strong given the Group is compliant. However the proceedings do consume unnecessary resource."
Business News Australia
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