By Ben Butler
SHAREMARKET bottom feeder David Tweed has taken legal action against a mortgage fund he claims has refused to give him the names of its investors.
The lawsuit is Mr Tweed's second in recent months, with Wesfarmers also in his sights for refusing him access to its share register.
In an application filed with the Federal Court last week, Mr Tweed alleges LM Investment Management has breached company law by failing to provide him with the names of investors in the LM First Mortgage Income Fund. Mr Tweed has asked the court to order LM to hand over ''a copy of the register in electronic form such that the data comprising the register is readable''.
The $487 million fund, which lends to property developers, was one of many that suspended redemptions in 2008 after a run on the mortgage fund sector.
Mr Tweed has reportedly been targeting several frozen mortgage funds, offering to buy units from frustrated investors at a 20 per cent discount.
Although the LM fund has frozen withdrawals and is closed to new investors, it continues to pay distributions as forecast and has maintained its unit price of $1.
LM chairman and chief executive Peter Drake said the government needed to act to stop Mr Tweed gaining access to lists of investors.
''We're going by the Privacy Act, but there's a loophole in the law that says if he asks for the names of members and how much they've got, we have to hand it over,'' he said. ''We're taking advice from our lawyers.''
Legislation to make access to registers more difficult failed to pass before the election and must be reintroduced to Parliament.
Mr Tweed's lawsuit against LM is due before Justice Ray Finkelstein for a directions hearing on December 7, while his bid for access to the Wesfarmers register is set down for a two-day hearing before the same judge starting on December 2.