What Happened - SOS Save Our Super

THIS IS NOT ABOUT A GAME OF SNAKES & LADDERS

ASIC

Late intervention, weak enforcement of trustee/platform due diligence, limited oversight of research/advice chains, fragmented complaint pathways, under-resourcing of MIS surveillance, failure to address red-flag complaints early, and only pursuing asset freezes/liquidation after major losses emerged.

Falcon Capital (responsible entity)

Failed in its core duties as a responsible entity, allowing mismanagement, late suspension of redemptions, and questionable related-party conduct.

First Guardian (the fund)

Operated with poor governance, opaque assets, and inadequate investor communication, leading to collapse and frozen withdrawals.

Research Houses

Issued positive ratings on high-risk, illiquid products, enabling wide distribution and reliance by advisers.

Trustees

Onboarded and maintained First Guardian on super platforms without sufficient due diligence or ongoing monitoring.

Licensee

Did not adequately supervise or monitor authorised reps, allowing systemic mis-selling to continue.

Advisors

Manipulated into selling a MIS product and failed to protect investors’ interests, breaching their duty of care to clients.

Break Down of Organisational Players

Financial Advisors:

Adviser / Firm	Role & Connection	ASIC Status / Actions
Ferras Merhi(Venture Egg, FSGA)	Major adviser; facilitated ~$296M in investments; received fees	Under investigation; assets frozen; likely to face enforcement action
Reilly Financial(Rhys Reilly)	Adviser linked to First Guardian SOAs	InterPrac terminated relationship; SOA authenticity under scrutiny
Miller Wealth Group	Adviser firm connected to First Guardian	Terminating; still listed on register
FSGA (licensee)	Oversaw advisers; held AFSL	License cancelled due to oversight failures; now in liquidation

Licencees:

Licensee / Entity	Role & Connection	ASIC Actions / Status
Financial Services Group Australia (FSGA) in liquidation	Held the AFSL under which advisers (e.g. Venture Egg, Reilly Financial) operated, advising clients into Shield and First Guardian.	AFSL cancelled effective 7 June 2025; Responsible Manager (Graham Holmes) permanently banned. ASIC found FSGA failed in supervisory oversight, adequacy of resources, competence, lodgment obligations, and solvency. ASIC froze assets and imposed a travel ban on Ferras Merhi (director) (ASIC, Professional Planner, FD Legal).
InterPrac (Sequoia-owned licensee)	Authorized advisers like Venture Egg and Reilly Financial to recommend investments into First Guardian and Shield.	Still under investigation but has not (yet) had its license cancelled. Internal guidance instructing advisers to stop placements in First Guardian was not communicated to ASIC (Professional Planner, The Australian).
MWL Financial Services in liquidation	Licensee tied to the Shield Fund; adviser-led placements connected to Shield and First Guardian.	AFSL cancelled, with director and compliance manager banned. Allegations include inappropriate advice, template SOAs with misleading content, conflicts-of-interest, and failure to advise clients of AFCA rights (Professional Planner).
Unitied Global Capital (UGC) in liquidation	Licensee whose advisers pushed investments into First Guardian prior to UGC entering liquidation.	Licence cancelled; director Joel James Hewish banned for 10 years for promoting speculative, non-compliant investments involving First Guardian and linked property speculations (The Australian).

Super Trustees

Super Trustee / Platform	Role & Connection	ASIC Actions / Status
Equity Trustees Superannuation Ltd	Hosted First Guardian and Shield Master Funds on its platform; accepted ~$160 m in investor funds.	ASIC has launched civil penalty proceedings in Federal Court over due diligence failures in relation to Shield, and is also under investigation for onboarding and monitoring First Guardian. (ifa, ASIC, Super Review, News.com.au)
Netwealth Investments Ltd / Netwealth Superannuation Services Pty Ltd	Provided access to First Guardian via its choice super platform (Super Accelerator/Wealth Accelerator).	Under ASIC investigation for hosting First Guardian; liquidators are reporting uncertainty about asset values and no estimate for recoverable investor funds. (ASIC, Netwealth, Professional Planner, Super Review, News.com.au)
Diversa Trustees Limited	Also offered First Guardian as an investment option on multiple platform products.	ASIC is investigating Diversa alongside Netwealth and Equity Trustees for inclusion of First Guardian on their platforms. (ASIC, Super Review)
Macquarie Investment Management	Host of the Shield Master Fund (separate but related collapse) — significant for context.	Also under ASIC scrutiny for including Shield on its platform; investigations ongoing. (The Australian, ifa, Super Review, Professional Planner)

Research House:

Key Points:

Research House	Role & Connection	ASIC Actions / Status
SQM Research	Rated both Shield and First Guardian as attractive investments.	Under scrutiny by ASIC. SQM downgraded First Guardian after spotting red flags—before ASIC even froze the fund. ASIC warned research houses they’re part of the failure chain. (The Australian, ifa, Financial Newswire)

SQM Research, which initially rated the funds favorably, downgraded them—but only after ASIC had frozen Shield (not before investigating First Guardian) The Australian.
ASIC Deputy Chair Sarah Court emphasized that research houses are part of the entire failure chain and are being actively investigated for their role in legitimizing these fund products ifa+1.
The collapse has triggered broader industry scrutiny, with questions now being raised about the integrity of research ratings and the timeliness/accuracy of reports coming from research firms

ASIC

Area of Responsibility	What ASIC Did	Issues / Admissions from Meeting
Fund Registration (MIS)	Registered First Guardian as a Managed Investment Scheme.	Admitted this is a box-ticking process under the law — no power to vet governance, risk, or appropriateness before registration.
Early Warnings (2020–2023)	Received complaints/emails re: UGC, David Anderson, commissions, mis-selling.	Said those were treated as sales/mis-selling issues, not proof of fund misconduct. No early intervention.
Investigation	Executed search warrants with AFP, seized devices, reviewed 100k+ documents.	Claimed only after this did they uncover fund misuse/misappropriation, which justified liquidation.
Liquidation	Applied to court to appoint liquidators/receivers.	Defended decision as in investors’ best interests; admitted balances shown to investors were inflated/false.
Asset Protection	Sought asset-freezing orders to preserve value for investors.	Confirmed this was their first priority, but acknowledged limited assets remain.
Enforcement Actions	Launched civil action against Equity Trustees; investigating Diversa, Netwealth, Macquarie, advisers, licensees, research houses.	Said more actions are likely, but must meet strict legal tests before proceeding.
Compensation / Restitution	Can ask courts for compensation orders or negotiate enforceable undertakings.	Admitted ASIC is not a compensation body; restitution may be slow, complex, and uncertain.
AFCA / Complaints	Encouraged investors to complain against all possible targets.	Acknowledged AFCA is overloaded; agreed to speak to AFCA about test cases and complaint strategies.
Accountability	Repeatedly pointed to Treasury/Parliament for systemic reform.	Did not accept ASIC failure; argued constraints are “system design” not lack of diligence.
Communication	Promised more regular updates and a “forward-looking” roadmap.	Agreed their current public info is too historical, confusing for victims, and leaves space for scammers.

The Players

ASIC

Australian Securities Commission – Failed to Act on the Early Warning Signs

Australians trust their super because it’s compulsory and government-regulated. Most don’t understand Managed Investment Schemes (MIS), yet both First Guardian and Shield were fully registered by ASIC, which makes people assume they’re safe for retirement savings.

But setting up an MIS is easy: file paperwork, appoint a responsible entity, lodge a compliance plan. Approval can take weeks, yet when things collapse, there’s no real accountability or public education from the regulator.

Despite allowing MIS products into super, ASIC and the government never clearly warned that registration doesn’t mean an investment is safe or suitable for retirement. No major campaigns, no simple explanations, and no clear risk messaging.

So thousands trusted these products because they appeared on super platforms and were ASIC-registered. They weren’t reckless — they relied on a system that gave false confidence and didn’t act in time. The failure wasn’t just the funds, but the framework that allowed them through without proper safeguards.