The Adviser Committee for Investors (ACI) was created in the aftermath of LMIM’s announcement that it was going into voluntary administration by advisory firms, Magellan and Financial Partners.
Explaining his decision to form the committee, Simon Litster, a senior partner at ACI founder Magellan, said: “Speed of thought and action would be critical to ensure client interests were represented in a situation where it was possible that other interested groups might be able to create benefits for themselves if there were no obvious energy representing investors."
The two founders of the ACI have since been joined by around 10 other firms, including Mondial based in the United Arab Emirates. Each new member has been asked to contribute $3,000 towards legal costs.
The founders of the ACI are now seeking new members and have drafted a charter which has been distributed to a number of IFAs in Europe, Asia and the Middle East. It is anticipated the number of advisers who are part of the group will increase over the coming weeks.
“If we did nothing the clients had more to lose”
As previously reported, representatives from Mondial, Magellan and Financial Partners visited Australia on a fact-finding mission and have since compiled a report, the details of which have been shared with ACI members.
A key achievement during the visit was to bring together restructuring firm KordaMentha and FTI, which is acting as LMIM’s voluntary administrator, for the first time.
On the trip, Litster said: “The most important observation was that if we did nothing, clients had more to lose than if we were able to create an umbrella for IFAs to represent clients and investigate recovery options. Someone needed to step forward as the voice for investors, hence the ACI.”
In addition, the ACI has appointed Australian law firm Holman Webb to act on behalf of investors, led by Shane Roberts.
Giving an indication as to the scale of the of the impact of LMIM’s closure, Mondial chief executive Sean Kelleher said he believed at least $400m had been invested in the fund range.
In a statement, the ACI confirmed the “start up” executive committee as follows:
• Simon Litster will liaise and represent IFAs in North Asia
• Peter Kende (Financial Partners) will represent IFAs in HK
• Neil Robbirt (Global Investments) will represent IFAs in S.E. Asia
• Alison Pockett (Magellan) is currently liaising with IFAs in Europe
• Sean Kelleher (Mondial) is currently liaising with IFAs in the Middle East
IFAs wishing to join the ACI, or who want more information, are urged to contact Simon Lister or the group on firstname.lastname@example.org.
It should be noted that, in addition to the $3,000 contribution towards legal costs, all members are being asked to sign over any position as a creditor (i.e. overdue commissions) “in order to build a fund that may enable Holmann Webb to follow any future litigation claims against certain parties on behalf of investors”.