Checking the investment and promoter - Australian Securities and Investments Commission

Companies and investment schemes

Before you to join an investment scheme, check to see it is operating legally.

Four safety checks

1	Search our database to see if the company managing your investment holds an Australian financial services (AFS) licence.
2	Search our database to see if this scheme is registered with ASIC.
3	Check FIDO's list of illegal investments
4	Ask the seller for their Product Disclosure Statement. Schemes must have a product disclosure statement (PDS). This document must give enough information about the scheme for you or your adviser to make an informed decision. More information about product disclosure statements. For listed managed investments only (that is investments that can be traded on a financial market), search now to check if a PDS has been lodged with ASIC.

What the law requires
A company which sells you such investments must:

hold a licence from ASIC. Their licence controls what kinds of schemes they can sell you.
be a public company (that is have Ltd, not Pty Ltd, after their name) Search our National Names Index to see if they have Ltd (and not Pty Ltd) after their name.

Before you hand over your money to someone asking you to join an investment scheme ask them: 'Does your company hold an Australian financial services licence to sell this investment?'

If they say they don't hold a licence then they're operating illegally. Hold onto your money. How to recognise a scam when you see one

Investment schemes involving 20 people must also be registered with us. Such schemes are called 'managed investment schemes' whenever they:

bring people together to contribute money to get an interest in the scheme
pool your money together with other investors (often many hundreds or thousands of investors) or use your money in a common enterprise
give day to day control over the operation of the scheme to someone else.

More about managed investment schemes

FIDO Website: Printed 11/21/2008