Financial regulatory body ASIC issues directive halting dealings of La Trobe's private credit funds
In a recent development, the Australian Securities and Investments Commission (ASIC) has imposed interim stop orders on La Trobe Financial's La Trobe US Private Credit Fund and the La Trobe Australian Credit Fund. These orders prevent La Trobe from dealing in interests for the affected funds.
The decision comes following a retail private credit surveillance carried out by ASIC, which revealed certain deficiencies in the target market determination for the Australian products. The concern for the La Trobe US Private Credit Fund is that its Target Market Determination suggests an inappropriate level of portfolio allocation given the risks and does not adequately specify an investment timeframe for retail clients. Similarly, the accounts offered under the La Trobe Australian Credit Fund suggest an inappropriate level of portfolio allocation given the risks of the fund.
La Trobe Financial, one of Australia's premier alternative asset managers with AUD$20bn (£9.75bn) in assets under management and over 120,000 investors, was contacted for comment regarding the interim stop orders.
ASIC's action is intended to protect consumers and retail investors from acquiring the La Trobe US Private Credit Fund. The interim stop orders are valid for 21 days unless revoked earlier. It is important to note that these orders do not include appropriate distribution conditions for the target market determination of the Australian products.
The interim stop orders are part of ASIC's ongoing efforts to ensure fund transparency, governance, valuation practices, management of conflicts of interest, and fair treatment of investors. This is not the first time ASIC has taken such action, having issued a total of 91 interim stop orders and one final stop order under DDO since the inception of the regime.
In a separate news, Blue Owl Capital unveiled its first interval fund focused on alternative credit, further underscoring the growing institutional interest in 'alternative' real estate. However, no specific information about why 'alternative' real estate is now institutional was provided in the current paragraph.
La Trobe Financial launched the private credit fund listed on the Australian Securities Exchange in May this year. The interim stop orders issued by ASIC are a reminder of the importance of proper fund management and adherence to regulatory standards in the financial industry.
