ASIC has made interim DDO stop orders against three private credit products offered by Melbourne Securities Corporation Limited (MSC) over target market determination deficiencies.

The products are the 6 Month (Fixed and Variable) Account, 12 Month (Fixed and Variable) Account and At Call Account (together, the Products) offered under the Remara Cash Management Fund (Fund), a registered managed investment scheme.

ASIC issued the orders because of deficiencies in the Product’s target market determinations (TMDs).

ASIC Commissioner Simone Constant said this action forms part of ASIC's ongoing work to address risks in private credit.

‘Where ASIC identifies concerns that products may be reaching retail investors they were not designed for, we will use our regulatory tools to act swiftly to intervene early, disrupt poor practices and protect investors from potential harm.’

ASIC is concerned that the target market in the TMDs for the Fund suggests:

• inappropriate levels of portfolio allocation as a ‘major component’ (up to 75%) and ‘core component’ (up to 50%)
• the Fund is suitable for retail investors seeking capital preservation
• inappropriate timeframes for retail investors to access capital, and
• an inappropriate rating of low risk for the Consumer’s Risk and Return Profile.

ASIC is taking this action to protect retail investors from acquiring products that may not be suitable for their financial objectives, situation or needs.

The interim orders prevent MSC from dealing in interests, giving a product disclosure statement for, or providing general financial product advice to retail clients recommending an investment in, the Fund’s Products. The orders are valid for 21 days unless revoked earlier.

These interim stop orders arose from ASIC’s surveillance of private credit funds which is focused on the distribution of private credit funds to retail clients through direct and advised channels, also fees, margin structures and conflict-of-interest management in wholesale private credit funds. This surveillance is being conducted as part of ASIC’s ongoing work in response to Australia’s evolving capital markets.

Background

As at 31 December 2025, the Fund has $39.856 million in assets under management.

The Fund invests in short term notes linked to a pool of Australian credit investments including AAA rated and Investment Grade (and equivalent Shadow Rated instruments) securitised public and private Residential Mortgage-Backed Securities, Asset Backed Securities, and Mortgage-Backed Securities. The Fund may invest up to 100% of its assets in Shadow Rated instruments. Shadow ratings are internal credit evaluations to assess the credit risk of issuers that do not have public ratings.

The Fund is not a capital protected or capital guaranteed product. There is no guarantee of the investment result, return or the amount payable to the consumer.

Under the design and distribution obligations (DDO), financial product issuers and distributors must ensure the product’s TMD is clear and appropriately defines the target market, accurately reflects the product’s risks and features and includes appropriate distribution conditions.

To date, ASIC has issued 99 interim stop orders and two final stop orders under DDO since the inception of the regime.

ASIC can act quickly under the DDO regime to disrupt poor conduct and prevent potential consumer harm.