ASIC has warned consumers about investing in overseas financial products that do not comply with Australian law.
The warning followed advertisements in the local press made by New Zealand company Asset Finance. The advertisements offered returns on the company's debenture stocks which ranged from between 9.75 per cent and 12 per cent per year.
The company's prospectus, however, was not lodged with ASIC and therefore did not comply with Australia's disclosure requirements.
Asset Finance has agreed to ASIC's demands to stop promoting its products in Australia until the company is compliant with Australia's regulation.
"If you take up an offer of securities from an overseas entity that has not complied with Australian law or deal directly with an overseas broker, you may lose the protections provided by Australian law," ASIC executive director for consumer protection Greg Tanzer said.
