The Federal Court of Australia has approved the settlement of a compensation claim initiated by ASIC to clients who were advised by Professional Investment Services (PIS) to invest in the failed Westpoint Group.
Under the settlement, PIS must pay eligible investors (group members) $5.9 million, ASIC said.
The court approved a distribution mechanism whereby the settlement sum will be distributed equally to group members based upon the total capital they had invested, the corporate regulator said.
This will result in group members receiving 62.5 per cent of the capital they invested, ASIC said.
On 7 September 2009, ASIC filed an application with the Federal Court in Brisbane seeking final determination of the identity of group members to whom compensation will be distributed and seeking approval for it to communicate with those group members, the corporate regulator said.
ASIC subsequently provided details of the compensation group members would likely receive and provided them with an opportunity to object to the settlement, ASIC said.
The settlement is now binding upon the group members adjudicated by the court as being eligible to receive the settlement sum of $5,945,176, the regulator said.
Under the terms of the settlement, PIS has until 30 November to pay the settlement, ASIC said.
ASIC will distribute the settlement upon the expiration of the Federal Court appeal period, or if an appeal is filed upon the finalisation of that appeal. The earliest ASIC could distribute the settlement is 14 December 2009 if no appeal is filed, the corporate regulator said.
