Newly-listed DNZ Property Fund says it will be referring a below-market offer for its shares to the securities watchdog.
DNZ says Carrington Securities, run by Bernard Whimp, has acquired more than 2.2 million shares at 60 cents each from investors - nearly 1% of the property investors' stock.
The company has about 245-million shares on issue.
DNZ shares closed at $1.02 a share on Monday, and company chairman Tim Storey says when Carrington's offer was made, DNZ shares were likely to have a value of at least 80 cents each.
Mr Storey says such offers are designed to take advantage of unsophisticated and vulnerable investors, and it's concerning that nothing that can be done to stop such unethical and predatory activity.
He referred the matter to the Securities Commission and the NZX.
Mr Whimp was banned as a company director for four years in 2006.