MIS investor hit by fees Leslie White June 2, 2010
A MANAGED investment scheme company has threatened legal action against investors if they fail to pay their fees.
South Australia-based Barossa Vines has sent letters to investors demanding immediate payment of $2500 for every one-tenth of a hectare lot for management fees - or recipients face legal action.
A copy of a letter seen by The Weekly Times demands thousands of dollars within three working days. It states no extension of time to pay will be considered.
One investor, who owns several lots, is seeking to offload his lots for just $1.
The investor, who has sunk more than $100,000 into the company, said his financial adviser had told him the investment would provide an income stream for his retirement.
He said returns had been "massively below" projections yet he had still been forced to pay thousands in management fees and now in legal advice.
He said the adviser had made recommendations using projections from BV, he said.
The Weekly Times has seen comparisons of projections and actual returns, which are thousands of dollars apart.
The threat from BV had inspired "fear and loathing", he said.
"I'm getting an invoice instead of an income," the investor, who had worked as a paralegal, said. "You sign irrevocable power of attorney - they got that one under my nose. I didn't know you could do that."
The investor said he could not afford the payments as a $100,000 investment in failed MIS giant Timbercorp had also gone bad.
He said he had been "stitched up for life".
BV director Antonio de Francesca did not return calls to The Weekly Times.
In August last year, a BV investor told The Weekly Times the company had left fruit - belonging to investors, not the company - on vines to rot.
The company also faced criticism last year for planting new vines as the industry was calling for a government-sponsored vine pullout.
There have been persistent industry rumours BV is in financial trouble, however, the company had in the past said it had contracts for all its fruit.
TIM Price at posting:
4.4¢ Sentiment: None Disclosure: Not Held
