The Government has scuttled Labor’s call for an enquiry into Westpoint, Fincorp and ACR.
The Federal Government has rejected Labor’s call for an enquiry into the collapse of property schemes Westpoint, Fincorp and Australian Capital Reserve (ACR).
Thousands of retail investors, mainly retirees, lost around $1 billion when the high risk managed investment schemes went under.
The ALP wants ASIC to be investigated along with regulatory powers of the Commonwealth.
It also wants the role of research houses, trustees, auditors and accountants investigated, as well as complaints and dispute resolution schemes, consumer compensation arrangements and unwieldy product disclosure statements.
In particular, a loophole that allows promissory notes greater than $50,000 to be exempt from certain disclosure requirements in the Corporations Act needs to be examined, opposition spokesman on financial services Nick Sherry said.
“There are some widespread and systemic issues of failure which do need urgent attention,” Sherry said.
But the Government said ASIC is already investigating the collapse of these companies and it would be inappropriate to anticipate the outcome.
“The corporate regulator is investigating the collapses and it should be allowed to get on with the job without being distracted by political stunts,” Parliamentary Secretary to the Treasurer Chris Pearce said.
The Opposition said the Joint Parliamentary Committee on Corporations and Financial Services should conduct the review, a suggestion rejected by chair of the committee, Liberal Senator for South Australia Grant Chapman.
“There will be no committee enquiry,” Chapman said.
He said the committee – of which Senator Sherry is a member – agreed last week that there will be no further inquiries until after the federal election because its members will be busy campaigning in their electorates.
“It’s clearly a political stunt – it’s come out of left field,” he said.
