ASIC seeks court restraints against Royce entities over alleged misconduct

ASIC is seeking Federal Court restraints against two Royce entities and two individuals over alleged unlicensed financial services and misleading investor representations.

The proposed orders would restrict Royce Capital Investments Pty Ltd, Royce (Aust) Real Estate Pty Ltd, Louie Kortesis and Paul Chiodo from advertising, promoting or accepting money in Australia for three offshore funds. Royce Global Investments LP and Royce Global Real Estate LP are registered in the Cayman Islands, while Royce Private Investments Fund LP is registered in Delaware.

ASIC is also seeking restraints covering the advertising, promotion or acceptance of money for financial products generally in Australia. The application therefore concerns the licensing perimeter for financial services involving Australian investors, rather than the offshore registration of the funds alone.

ASIC alleges that Royce Capital raised $1.536 million from five Australian self-managed superannuation fund investors in August 2025, purportedly for investment in one or more of the funds. The regulator alleges that Royce Capital provided financial services without an Australian financial services licence.

ASIC also alleges that Mr Kortesis and Mr Chiodo were involved in the unlicensed conduct. It further alleges that Royce Capital and/or RARE made misleading or deceptive representations in brochures provided to some investors, including representations that investors would receive a guaranteed or fixed return of 13% per annum.

The court has yet to determine the case.

The conduct and representations are alleged, not findings of liability. ASIC’s proposed restraints would affect the entities’ ability to solicit or accept Australian investor money and communicate about the named funds or other financial products. The regulator’s release does not specify whether the Federal Court has granted interim orders or describe any immediate change to the entities’ operations, assets or investor communications.

ASIC has also issued a consumer alert warning about people being enticed to invest superannuation savings in complex and risky schemes, including through pushy sales tactics urging quick switches. The release said Mr Chiodo is the subject of separate Federal Court proceedings concerning the Shield Master Fund, referenced as 26-133MR. See ASIC, media release 26-133MR, “ASIC takes action against operators of the Shield Master Fund”, https://asic.gov.au/about-asic/news-centre/find-a-media-release/2026-releases/26-133mr-asic-takes-action-against-operators-of-the-shield-master-fund/.

For compliance teams, the immediate jurisdictional question is whether Australian-facing promotion, advice, arranging or acceptance of investor money falls within conduct requiring an Australian financial services licence. If made, the proposed orders would also require attention to brochures and return representations, particularly where a fixed or guaranteed outcome is presented to SMSF investors.

ASIC’s application remains subject to the Federal Court process. The regulator’s release does not provide a next hearing date or response deadline, leaving the timing of any interim restraints and the court’s determination open.