The message is clear: if they don't play ball and register, the writs will keep coming. "It is our strong preference to avoid time-consuming and costly litigation against you. We wish to engage with you to discuss the options available to settle your loan(s) with Timbercorp Finance."

Liquidator KordaMentha has set up an online service with an application form and contact details for financial counselling services for anyone experiencing financial difficulties.

But it makes it clear, the move isn't about wiping the slate clean but working with borrowers "through our hardship assistance program" and "exploring options for those suffering financial distress".

At the end of the day, the job of the liquidator is to claw back as much money as it can for its creditors. It isn't about investigating if the financial advice was shoddy and letting the victims off the hook. That is for the victim and the financial adviser or licensee to work out.

For KordaMentha, its biggest concern is beating the clock on a statute of limitations of six years. Timbercorp collapsed in 2009 and so it is in a hurry to issue writs.

Complainants in a class action taken by some victims of Timbercorp back in 2009 were advised by their lawyers not to repay their loans. When the High Court refused to hear an appeal in May KordaMentha took the pause button off and started seeking repayment.

KordaMentha is issuing an average of 70 writs a week to the 2871 borrowers who owe almost half a billion dollars to creditors, including ANZ Bank. 

The twist in all of this is that the creditors could potentially make hundreds of millions of dollars in profit from accrued interest at whopping 13 per cent plus default rates.

Put simply, when Timbercorp went belly up, there were 7511 borrowers owing $477 million to secured creditors. More than $247 million of that debt was repaid, but that figure has blown out to $492 million over the past five years, which is equivalent to $260 million in interest payments.

Labor Senator Sam Dastyari said he had met with liquidator KordaMentha and ANZ Bank and had expected that any action to recover debts would be "paused" while complaints were investigated, particularly victims of shoddy advice. "This letter being sent out doesn't offer that," he said.

Senator Dastyari, who is chairing a Senate inquiry into collapsed forestry managed investment schemes, including Timbercorp, Great Southern, Environinvest, FEA Plantation, Rewards Project and Willmott Forests, said that in the past few days more than 40 people had contacted him saying they had received writs from the liquidator.

He said schemes such as Timbercorp wouldn't have come into operation without the loans from ANZ. It is an interesting point that he will undoubtedly pursue during the Senate inquiry. He wants compassionate relief for victims of advisers of fraud and bad advice. He wants their cases investigated and any legal action put on hold. 

Interestingly, a submission lodged late last week by corporate regulator ASIC into managed investment schemes said it had identified a number of factors that the collapsed schemes had in common, including "employing a business model that is heavily reliant on upfront payments from investors for working capital and proves insufficient to service the ongoing operations of the business".

This alone should raise questions about the type and standard of due diligence conducted by these financial institutions when they agreed to back these models by lending them money.

In its submission, ASIC also says one option is the introduction of "a last resort compensation scheme" to compensate investors and financial consumers from inappropriate financial advice. It is a point worth examining in the circumstances.

Timbercorp was one of a number of managed investment schemes that blew up during the global financial crisis. Their demise followed a decision by the ATO in February 2007 to end the tax deductibility of upfront fees paid by investors.

One victim said her adviser sold Timbercorp on a large scale and put seven families into Timbercorp. "Our families stand to lose $1.4 millions now, one of us has gone bankrupt and two more will follow. I stand to lose financial stability and might have to go on government pension at retirement," she says.

More than $92 million was earned in commissions from Timbercorp, with banned adviser Peter Holt at Holt Norman & Co, writing almost 8 per cent of the business.

As Jeff Morris, a former financial planner and CBA financial planning whistleblower, says: "Where were the clients' best interests in all this as the planners concerned put the telescope to their blind eye and buried their snouts deep in this commission trough?"

In various guises, the punters keep getting clipped and the advisers almost invariably keep getting off scot-free. "What can you expect? he asks.

"You get a recommendation from a bipartisan Senate inquiry for a royal commission into this widespread misery and a government that has had royal commissions at the drop of a hat into pink batts and unions simply decides it can't be bothered!"