An investment fund that’s fighting for its survival has been put into the hands of the receiver and its assets frozen.

Some 1,200 investors in the Quadris Environmental Fund fear they will lose all or a significant part of their money.

And they have criticised the island’s regulator, saying the Financial Services Authority should have done more to help the investors.

But the FSA insisted that its remit is limited as Quadris is an unlicensed collective investment fund which is aimed at qualifying and experienced investors.

Quadris Environmental Forestry Fund PCC plc, which has a registered office on Athol Street, Douglas, was launched in 2001 and has more than £100m invested in the teak plantations of Floresteca in Brazil.

But last year it posted a $20m loss, with the auditors saying there were significant concerns about the company’s ability to continue as a going concern.

Last September, the FSA appointed Gordon Wilson of CW Consulting as an adviser to the fund. In February he became controller.

On the same day it was announced that Estera Fund Services would replace Blue Sea International as the island fund manager.

Now Quadris’s lender, American hedge fund Crestline Arvore, has declared the fund is in default and has appointed a joint receiver, Craig Mitchell and David Craine of Browne Craine & Co.

Quadris’s bank accounts have been frozen.

But investors insist the fund is not in default and it has sufficient assets to pay off the lender at any time.

Stephen Metcalf, who is a Warsaw-based partner at Synergi Investment representing £7m of investment by Global Net members with shareholdings in Quadris, told iomtoday: ’Crestline as the lender is claiming that there have been a number of defaults on their loan and have therefore decided to appoint a receiver, to place their own representatives onto the board and to proceed to run the fund, obviously to their own significant benefit.

’Legal opinion as stated by lawyers from both New York and the Isle of Man is that the default is by no means certain.

’Surely, the regulator cannot sit back and do nothing while claiming to be protecting the interests of shareholders.’

He added: ’Shareholders find it incomprehensible that the underlying assets that they bought remain intact and offer significant value and yet they stand to potentially lose either a significant part or possibly all of their money.’

The FSA will be conducting a review of experienced investor schemes following a series of fund failures, including those linked to the Premier Group.

In a statement, the FSA explained that Quadris is a qualifying fund and therefore not licensed or authorised by the regulators.

Its remit for such schemes is to register them, receive notifications of changes and supervise their appointed Isle of Man functionaries.

These schemes, which are typically of higher risk, cannot be sold to the general public and there is no compensation scheme for investors who have to sign a declaration confirming they accept the risks.

It said: ’The FSA continues to work with relevant parties (functionaries, the receiver and the controller) on specific matters pertaining to Quadris and as it relates to the Authority’s remit relative to this fund.’