ASIC Imposes Interim Stop Order on Offers from Finnia Income Limited

ASIC has placed an interim stop order on offers from Finnia Income Ltd (Finnia) in response to deficiencies in the issuer's target market determination (TMD).

The orders stop Finnia from issuing interests in, giving a prospectus for or providing financial advice to retail clients under the existing TMDs.

Fazzaco Hall of Fame 2022 Officially Opens (Click to Nominate)!

ASIC placed the interim stop order to protect retail investors from potentially investing in offers that may not be suitable for their financial objectives, situation or needs. To date, 13 interim stop orders have been issued in relation to non-compliant TMDs, and seven interim stop orders remain in place. Six have been lifted following actions taken by the entities to address ASIC's concerns.

Finnia is an unlisted public company seeking to raise $20 million under a prospectus through the issue of redeemable preference shares in the company for the purpose of lending to real estate development projects.

At the time of lodgement of the prospectus, Finnia had not prepared a TMD for the offer. Finnia produced a TMD after ASIC communicated with the company.

ASIC was concerned that Finnia's TMD did not adequately describe the objectives, financial situation and needs of consumers likely to be in the target market in an objective manner. ASIC also found that the TMD for the prospectus did not meet appropriateness requirements under the design and distribution obligations (DDO).