The cash-strapped investment club, Cash Plus Ltd will not be able to pay its investors the principal and interest owing to them on March 31 as it had previously announced.

A statement issued yesterday by the Financial Services Commission (FSC) said it had urged Cash Plus to issue a pubic notice advising investors of its position.

The FSC disclosed that it was informed by the attorney-at-law acting on behalf of Cash Plus late yesterday afternoon that "Cash Plus Limited does not currently have the funds to commence the repayment of the principal and interest owing to their investors on March 31, 2008, as they had previously indicated". The FSC has promised to keep the public informed as the matter progresses.

Cash Plus went to the Supreme Court late yesterday with an application under the Companies Act for the court to appoint a manager to assist Cash Plus in administering its affairs. The company's lawyer, Minette Palmer, said Cash Plus hoped to make payouts by April 14 .

more than $4 billion

At the end of February, Cash Plus had declared in a public advertisement plans to resume payments of monthly returns by March 31, but noted that it was contingent on FSC approval. It has more than 40,000 investors with loans totalling more than $4 billion.

In a statement issued earlier this month, the FSC said it was not trying to hinder Cash Plus from making payouts to investors. The FSC said it had always indicated its willingness to allow Cash Plus to make payouts to its investors once it approached the FSC for such permission.

A cease-and-desist court order issued in December remains in effect against Cash Plus until it is licensed to deal securities or have its investment products registered.

The order bars Cash Plus from conducting securities business with members of the public, which includes the taking of new funds and making payments to its investors.

The FSC had said in a public notice earlier this year that it was willing to vary the order, allowing Cash Plus to pay all outstanding balances.

Cash Plus had brought an application in the Supreme Court in January last year seeking declarations as to whether the nature of its business required it to be registered under the Securities Act. In January this year, it withdrew the suit and said it was willing to be be registered with the FSC.

So far, Cash Plus has not applied to the FSC to be registered.