Mayfair 101 says ASIC action could derail Dunk Island redevelopment

14 April 2020, Written by Business News Australia

Mayfair 101 says ASIC action could derail Dunk Island redevelopment

The developer behind a $1.6 billion redevelopment of Dunk Island in Far North Queensland says recent legal action taken by the corporate watchdog could disrupt the project.

In a statement to the media, Mayfair 101 says the Australian Securities and Investment Commission's (ASIC) legal action regarding alleged false or misleading online advertisements could delay or halt its revitalisation project at Dunk Island.

The company launched its rejuvenation of Dunk Island back in September 2019 when it acquired the Queensland island for $31.5 million.

The investment group then announced it intended to pump in $1.6 billion into both Dunk Island and its mainland neighbour Mission Beach over the next 15 years to attract tourism to the region.

According to a spokesperson from Mayfair 101 the project could be impeded by ASIC's legal action.

"The Mayfair 101 Group remains committed to revitalising Mission Beach, Dunk Island and the surrounding region," says the spokesperson.

"However, we are concerned that this unwarranted action by ASIC has the potential to disrupt our strong progress in the region."

Last week ASIC accused Mayfair 101 of running misleading financial advertisements by promoting two debenture products as being term deposits online.

Further, ASIC said Mayfair's promotional material for the products used words including "term deposit alternative", "term investment", "fixed term", "certainty", "confidence" and "capital growth".

Mayfair 101 has previously rejected ASIC's action, saying it will vigorously defend the proceedings.

Further, Mayfair 101 has complained about media reports written about it after the group decided to temporarily suspend redemptions on 11 March in response to Covid-19.

The Mayfair spokesperson said this was not an uncommon step for fund managers to take in order to protect the value of assets and preserve liquidity and has laid into ASIC for picking and choosing its battles.

"[ASIC was] happy to overlook superannuation funds updating their disclosure documents about freezing redemptions or banks limiting cash withdrawals to just $5,000 at some branches, but felt the need to target the Mayfair 101 Group, which has ultimately acted in accordance with our rights and in the best interests of our investors during an unprecedented global crisis," says the Mayfair 101 spokesperson.

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Business News Australia

 
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