ob体育 has placed a stop order on advertisements for the Skyring Fixed Income Fund (the fund). The responsible entity of the fund is Skyring Funds Management Limited (Skyring).
The stop order prohibits Skyring from promoting or making statements that compare the fund to term deposits or offer a fixed return without proper risk warnings.
This action follows an ob体育 review of recent radio advertisements for the fund, which found the advertisements contained misleading or deceptive statements.
ob体育 formed the view that Skyring鈥檚 advertisements were misleading or deceptive because they suggested that investments in the fund had the same or a similar level of risk as bank-issued products. This comparison is inaccurate because the fund carries significantly higher financial risk than bank-issued deposit products.
The fund鈥檚 underlying assets include notes issued by a related entity and secured by securities over commercial, industrial, residential and retail properties.
ob体育 may consider further regulatory action in relation to the fund and Skyring.
Background
In June 2020, ob体育 warned investors to be wary about advertising that compares fixed-term investment products to bank term deposits and told seven REs to correct their advertising in relation to a total of 13 funds (refer 20-137MR). The Skyring Fixed Income Fund was one of these funds.
As a result, Skyring removed the following from its website:
- an image comparing the fund鈥檚 return to term deposits;
- a statement that the fund is capital stable; and
- investor testimonials.聽
In August 2020, ob体育 received a misconduct report from a member of the public raising concerns that the fund was being falsely promoted as a term deposit in a series of radio advertisements airing between June 2020 and August 2020. In September 2020, ob体育 reviewed and subsequently imposed the stop order on the radio advertisements.
ob体育 is continuing to monitor the advertising and labelling of managed funds in the current economic environment (refer 20-218MR).听听