Technically, yes. But that can be a long time coming and the...

Technically, yes. But that can be a long time coming and the dislocation pressure on the SP (if that's what happens), can be too much for some. We are just going to have to let this play out. Remember, the regulator does hundreds of investigations a year. Comparatively few end up with adverse findings. However, when you are high profile, with a listed entity to boot, the reputational damage can be severe. Regal lost just over half their assets under management in their Australian L/S fund during the 2015 ASIC investigation due to reputational risk damage and people going risk off on them. This is the potential problem for the SP of RF1.

Also worth noting that it is important that Regal keep their eye on the ball on the investment side while this goes on. During the 2015 investigation, their L/S strategy actually performed very well, delivering a total return of 20.8% versus 2.8% for the ASX300 index over the course of the calendar year (the investigation went from June to December). It's not just about the outcome, but also about keeping their eye on the ball while this goes on.