Court bid to wind up fund

The corporate regulator is seeking to wind up a $400 million investment fund run by failed Gold Coast group LM Investment Management.

The corporate regulator is seeking to wind up a $400 million investment fund run by failed Gold Coast group LM Investment Management.

The move comes after an attempt by rival Trilogy Funds Management to take over the fund as responsible entity.

In an application filed in the Queensland Supreme Court, the Australian Securities and Investments Commission called on Derrick Vickers, Darryl Kirk and Gregory Hall of PricewaterhouseCoopers to be appointed receivers of the fund, known as the First Mortgage Income Fund.

The receivers would then act to ensure the fund is wound up in accordance with its constitution, ASIC told the court.

ASIC's move is resisted by Trilogy, which had asked the court to give it control of the fund.

Lawyers for Trilogy, Piper Alderman, said the request by ASIC would mean unit holders paid double remuneration costs, as members would still be required to pay LM Investment Management, which is also insolvent.

The First Mortgage Income Fund, one of LM's many funds, has been illiquid since 2009.

The funds management empire, valued at $740 million, belongs to controversial Queensland businessman Peter Drake.

Trilogy's case will return to court on May 13.

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