Australian regulator suspends licenses of Theta Asset Management and Valuestream Investment Management
ASIC suspended the licences because the two entities are under external administration.
The Australian Securities & Investments Commission (ASIC) has announced the suspension of the Australian financial services (AFS) licences of Sydney-based financial services providers Theta Asset Management Ltd and Valuestream Investment Management Ltd. The suspension is set to be in force until July 21, 2020.
The licences were suspended because the two entities are under external administration.
On December 13, 2019, Christopher Darin and Mervyn Kitay of Worrells Solvency & Forensic Accounting were appointed as administrators of both Theta Asset Management Ltd and Valuestream Investment Management Limited. Although ASIC has suspended the licences, it has used its power under s915H of the Corporations Act to allow the administrators to conduct certain necessary activities under the licences during the administration.
Theta Asset Management Ltd is the holder of AFS licence no. 230920. Valuestream Investment Management Limited is the holder of AFS licence no. 246621.
Let’s recall that Theta Asset Management Ltd is the responsible entity for Sterling Income Trust. On December 11, 2019, ASIC launched an action against Theta Asset Management Ltd in the Federal Court in Western Australia focused on the promotion and management of the Sterling Income Trust.
In this action, ASIC alleges, inter alia, that Theta:
- issued five defective Product Disclosure Statements for the Sterling Income Trust;
- failed to take all steps necessary to effectively monitor the performance of Sterling Corporate Services Pty Ltd (SCS) as the investment manager of the Sterling Income Trust and satisfy itself that SCS had carried out its contractual obligations adequately;
- failed to identify, document, assess, evaluate and effectively manage and control all conflicts of interest, and
- failed to ensure all financial statements of the Sterling Income Trust were completed and available for audit within two months of the relevant period and were lodged with ASIC on or before the lodgement date.