La Trobe marks ASIC's first action against private credit funds following surveillance
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More news: The corporate regulator has taken its first action against a private credit fund following its private markets surveillance.
The Australian Securities and Investments Commission (ASIC) has issued interim stop orders on the La Trobe 12 Month Term Account, 2 Year Account and its US Private Credit Fund after alleging deficiencies in the target market determination (TMD).
The 12 Month Term Account and US Private Credit fund are both part of the listed La Trobe Private Credit fund.
ASIC said it was concerned the TMD for the funds:
- Suggested an inappropriate level of portfolio allocation given the risks of the fund; and
- Does not adequately specify an investment timeframe for retail clients.
The stop order prevents La Trobe from giving a product disclosure statement for, or providing general financial product advice to, retail clients recommending an investment in the funds. The order is valid for 21 days unless revoked earlier.
On the 12 Month Term Account and 2 Year Account, ASIC said the funds were invested almost entirely in loans secured by registered first mortgages, with the exception of small cash and term deposit holdings held to meet cash requirements.
“These products are not bank deposits. The rates of return are not guaranteed and are determined by future revenue of the pool of assets that comprise the account, the investment may also not generate the expected income returns and there are conditions around withdrawals,” ASIC said.
On the US Private Credit Fund ASIC said the US companies it was invested in were not rated by any ratings agencies and were investing in loans that involved an above average amount of risk and volatility or loss of principal.
What they said: “This stop order referral arose from ASIC’s retail private credit surveillance which focused on fund transparency, governance, valuation practices, management of conflicts of interest and fair treatment of investors, conducted as part of its response to Australia’s evolving capital markets,” ASIC said in a statement.
ASIC pauses new investments into La Trobe 12 Month Term fund
The news: The corporate regulator has issued interim stop orders on the La Trobe 12 Month Term account after alleging deficiencies in the target market determination.
The context: The interim stop order pauses new investments into the fund.
The 12 Month Term account is one half of the listed La Trobe Private Credit fund that floated in June 2025.
