The Commerce Commission has launched an investigation into Forsyth Barr's role in the sale of Credit Sails, a stock exchange listed product that collapsed during the global financial crisis.
The regulator says the probe is being carried out under the Fair Trading Act into alleged misleading representations made as to the characteristics and risk of the Credit Sails financial product.
Forsyth Barr was the lead manager and underwriter of Credit Sails, which raised $91,500 from local retail investors in 2006.
The failure of the complex financial product, which sunk when its investments in Icelandic banks and Lehmans, left investors with virtually nothing.
The commission says it's not investigating Macquarie Fortress Notes.