Despite concerns dealer groups welcome the federal government's inquiry into agribusiness managed investment schemes (MIS).
"I would welcome any inquiry that prevents collapses like Timbercorp and Great Southern ever happening again," Consultum Financial Advisers representative Neil White said.
"However, if it is just going to be another point of leverage for an industry bashing exercise then that would be extremely disappointing.
"The financial services industry can only research and judge products on the basis of the research available, and that research suggested that the schemes were primarily sound."
White said many of the underlying MIS businesses were sound, just not the companies operating around them.
Australian Financial Services (AFS) representative Michael Butler also supports the inquiry but was concerned it would take too long to come to a resolution and investors in the MIS would suffer as a result.
"What we need is the government to take some action. While the review is a good idea and we support it, it will be too late. The government needs to step up and understand that it stands to lose more than the investors," Butler said.
Despite this Butler intends to make a submission to the inquiry.
The inquiry by the Parliamentary Joint Committee on Corporations and Financial Services was set up on the back of the collapse of agribusiness companies Timbercorp and Great Southern.
It will look at agribusiness MIS with particular reference to the business model and scheme structures of MIS, the impact of past and present taxation treatments and rulings relating to MIS, and commissions and fees paid to marketers, distributors and sellers of MIS to investors.
Submissions are open until 26 June 2009 and it is anticipated that a report will be handed down in September.
On Friday, Treasury released the findings of a review of non-forestry MIS. As a result, the government will consider whether there is a need for changes to the tax treatment of non-forestry MIS in light of the recommendations of the Review of Australia's Future Tax System.
