ASIC cracks down on private credit products in Australia

The Australian Securities and Investments Commission (ASIC) has issued temporary stop orders on three private credit products offered by Melbourne Securities Corporation (MSC). These products are part of the A$39.9 billion Remara Cash Management Fund. The regulator cited “deficiencies” in target market determinations, which are legal documents outlining intended audiences and distribution methods for financial products.

ASIC Commissioner Simone Constant warned the private credit industry to expect increased enforcement action. The regulator is stepping up scrutiny of lending practices, valuations, and governance following the insolvency of Sydney-based developer Bathla Group, which has exposed approximately 40 funds within Australia’s A$200 billion private credit market.

ASIC is currently conducting surveillance across wholesale and retail funds to ensure asset valuations accurately reflect underlying risks. The regulator has called on credit managers to perform detailed portfolio reviews and urged superannuation trustees to strengthen due diligence. The stop orders against MSC are set for 21 days, preventing the firm from providing product disclosure statements or financial advice regarding these specific interests to retail clients.