In a submission to the Senate inquiry into the performance of ASIC, Mark Hoddinott a NSW Central Coast-based adviser has called for mandated independence of responsible entities of managed investment schemes.
Hoddinott of Hoddninott Consulting, a financial adviser licensed by Premium Wealth Management and former president of CPA Australia, who suffered from the collapse of the Willmott Forestry scheme has argued that following the collapse of Willmott Forestry, and its entry into liquidation in 2010, there was a “blatant transfer of wealth from mums and dads to predatory corporate raiders and complicit liquidators who acted in total conflict of their duty of care.” He has also expressed his concern that gaps in the regulatory system led to nefarious activity in the aftermath of the collapse of the scheme. Hoddninott stated that, “in my role as a financial planner from the period 2003 to 2010 I recommended to various clients of my practice to invest into the timber industry in Australia via Willmott Forests’ managed investment schemes. These were sound financial investments, approved by the ATO for tax incentives and supported by independent research.”
Hoddinott concedes that as a shareholder in Wilmott he does not solely blame the stakeholders but insists that the regulatory system overseeing managed investment schemes failed in its duty and said that, “a core flaw in Australian corporations law was the absence of a requirement for responsible entities of managed investment schemes to be independent of scheme managers and promoters.” He suggested that ASIC should respond to concerns from investors, so matters like Willmott are “monitored to ensure investor rights are protected” and guarantee that “flaws in the legislation are remediated.”