Blue Sky Share Holders Association, page-65

If they hadn't had the loan, all that would have happened is that they would have wound up sooner - there was an external report into the loan saying it was the best option they had available at the time to keep the company afloat.

All companies that manage peoples money require an AFSL license, that license requires the company to have a certain amount of cash in the bank to accommodate repaying investors in their products if they engage in actions in breach of their AFSL License. BLA was almost in breach of these requirements and needed the cash immediately. The alternative was that they loose their AFSL License and the management of their investments was handed over to the Government and re-distributed to qualified AFSL License holders.

This would have resulted in ZERO for investors and ZERO for staff liabilities. So they found an option that gave them a chance to try and recover - not the best option, but an option.... and they didn't make it.

If you actually read the financial reports issued, all of the information is there to see and they disclosed the breach...