Late on Friday afternoon, the Australian Securities and Investments Commission (ASIC) announced it had stepped up its enforcement efforts in relation to former Venture Egg boss Ferras Merhi.
The corporate regulator has been looking at Merhi for some time, taking its first action in February this year when it sought interim freezing orders over his property, which the Federal Court granted and subsequently extended until 12 December 2025.
ASIC then cancelled the Australian Financial Services Licence of Financial Services Group Australia (FSGA), which he also controlled, while also permanently banning its “on paper” responsible manager, Graham Holmes, before securing travel restraint orders against Merhi in July.
This regulator’s move on Friday included seeking approval from the Federal Court to “expand its existing proceeding” against the currently unlicensed Merhi to further allege that he “engaged in unconscionable conduct, failed to act in the best interests of clients, gave conflicted advice, and provided defective statements of advice whilst receiving millions of dollars”.
At the heart of the latest action is the former adviser’s role in the $1.2 billion collapse of the Shield and First Guardian master funds, including using marketing companies to push a stream of clients to both Venture Egg and a number of firms licensed through FSGA.
“Between 2020 and 2024, Mr Merhi and advisers working for him allegedly advised clients to invest around $296 million of their superannuation into the First Guardian Master Fund (First Guardian) and around $230 million into the Shield Master Fund (Shield),” ASIC said in its statement.
According to the regulator, this action netted Merhi almost $18 million in upfront advice fees and more than $19 million from “entities associated with First Guardian for marketing First Guardian to clients”.
“This type of conduct doesn’t just undermine the integrity of the financial advice and superannuation industries, it can have a devastating impact on people’s lives,” ASIC deputy chair Sarah Court said.
Appearing on Channel 7’s Spotlight on Sunday night, Merhi said his “truth” is that he too was misled by David Anderson and Simon Selima.
“I think that my version will help lead people to what’s actually happened and what’s gone wrong,” he said.
According to Merhi, he never actually received any of the $19 million paid to his marketing firm, claiming that “most of that money is with Google and Facebook”.
“I didn’t pocket this money. It’s not in my pocket. It’s money that was spent on these ads that were being put onto these platforms. They have most of that money, not me,” he said.
Under his version, he too is a victim and was misled into believing that Shield and First Guardian were sound investments and, as a result, is “losing everything” like his clients.
“At the time that I gave their recommendation, there was nothing to suggest that there was anything that the clients were getting anything but benefit, and that their retirement savings were going up. That’s what my intention was,” Merhi said.
He added: “I have a robust checking system that I’ve been using for the last 17 years and … relying on these auditors and research houses and billion-dollar platforms that have been around longer than I’ve been alive. If I’ve been misled then, then everybody’s been misled … I’m not the only person to blame here.”
The claims are reminiscent of those made by the head of Merhi’s former licensee, Sequoia’s chief executive Garry Crole, on a financial results webinar last week where he said “if you read the SQM Research and you look at the quality of auditor, in particular Shield having BDO, the high-quality platforms that approved those products, there was no reason for us to doubt that Shield and First Guardian were what they claimed to be”.
The question for Merhi is whether the courts will buy his explanations, because it’s clear that ASIC isn’t.
Calling the Venture Egg business model “unconscionable”, the raft of contraventions that the regulator is alleging include statements of advice containing false or misleading statements about the nature of the Shield Master Fund that implied it was “operated by Macquarie”.
“ASIC will also seek to allege Mr Merhi falsely represented that he had no vested interest in the recommended funds when, in reality, he was involved in marketing both schemes and received tens of millions of dollars for marketing First Guardian,” it said.
“Clients allegedly were led to believe they were receiving independent, tailored advice. Instead, they were allegedly channelled into pre-determined investment portfolios that were highly risky and served the financial interests of Mr Merhi and his businesses.”
What has ASIC been doing?
Recent months have seen the regulator take expanding action on a number of fronts, from banning advisers to suing a super fund trustee, but the question that keeps jumping out is: why has it taken so long?
Long-time ASIC critic and Liberal senator Andrew Bragg appeared on Spotlight, railing against the seeming lack of urgency from the regulator.
“They were warned back in October 2023 from a very reputable financial services company that there was massive malfeasance here,” Senator Bragg said.
“They took almost a year to announce a proper full investigation. There are large businesses that have made complaints and warnings about First Guardian and ASIC ignored them.”
The Financial Advice Association Australia had “facilitated reports” to ASIC as early as 2023, according to CEO Sarah Abood, after its members had seen some of the advice being provided.
Spotlight also presented several emails to ASIC’s deputy chair – one showing that Paul Chiodo, one of the directors of Shield responsible entity Keystone Asset Management, had alerted the regulator to suspicious activities inside First Guardian in March 2022.
First Guardian’s RE, Falcon Capital, was the trustee of the Chiodo Diversified Property Development Fund until June 2021, and a $94 million investment in the frozen fund is still on First Guardian’s books despite attempting to sell it off in March last year.
“I would be a little wary about allegations by Mr Chiodo, who was at the very heart, in our view, of a big portion of this misconduct,” Court said in response, noting that she had not previously seen the email in question.
It’s sometimes a little too convenient to lay the blame on ASIC’s shoulders, however, it is ultimately the body entrusted with enforcing the laws that govern financial services in Australia.
If ASIC expects to hold other players in the system to account, particularly when they pay for the privilege of being regulated, then it’s fair to wonder how it took so long before investigations began in earnest.
Court herself admitted that how misconduct of this scale got past the corporate cop are “fair questions for investors to ask”, though she pointed to the extreme complexity involved in the conduct as slowing down progress.
“These matters that we are investigating are amongst the most complex and most resource-intensive matters we have ever undertaken, and it’s been a little bit like, you know, you pull a piece of string, and there is more and more misconduct, more and more entities, more and more individuals involved,” she said.
The deputy chair certainly isn’t wrong, though some may view the explanation as more akin to an excuse.
Court added that ASIC’s “North Star” is to recover as much investor funds as possible.
Hopefully the regulator can follow through on that goal.
Where’s the government when citizens need them? Your regulator failed their duties and your mandatory super fund industry just experienced the biggest Financial fraud, negligence and failure in Australian history ever! You sit with 12,000 people and all their family members in significant stress and suicidal state, yet the government is non-existent!
Mmn, should we have a royal commission into the superannuation and financial services industry?!
Oh, that’s right, we did only a few short years ago!
And look at what a wonderful difference it has made!
Just more ammunition for the ALP to take a further step towards over-regulating non-IF super funds.
It’s not ok for ASIC to say they have a ” North Star ” when their compass has been pointing due South.
Isn’t there always a Dubai connection these days.?
Isn’t there always a connection or an “associate” who knows an ex-Comanchero boss ?
Isn’t there always a one size fits all,volume based sales process driven by conflicted greed ?
Isn’t this exactly what those investors who believed they were receiving personalised, individual based advice in their best interests want when they engage a Financial Planner managing their retirement savings ?
Venture Egg employed up to 6 Financial advisers through this period who were ultimately responsible for delivering the advice with their name of the SOA, three of these are now working at reputable organizations. Where is the due diligence in the industry on reference checking etc. How can these advisers continue to advise everyday Australians
I saw the holdings of First Guardian. There was, at best $3,500 that could be recovered, the overwhelming majority is gone.
Millions of dollars in option fees on land that they couldn’t settle, low interest loans to a pub that made no money (now with a receiver), property developments in regional Indonesia that made no sense and “cash receivables” which translates to total bullshit packaged up for sale to overseas investors who, naturally, didn’t really like the idea of buying smelly air.
ASIC is incompetent to the point of negligence. They obsess about catching out stupid small compliance matters like a licensee who didn’t put an adviser on the FAR but completely ignored this issue until it was to late. Even this week they were pushing for more rules about wholesale investors. More rules they can’t supervise, can’t implement and that their employees barely understand.
There were warning signs, they were told, they failed to act. The most interesting question is specifically WHY the person who received the tip off failed to act considering how senior they were and who they are connected to.
Platform providers also failed these investors. They hold money and transfer it, the VERY least they could do is physically inspect where it goes.
The worst part (for us) is the CSLR – the amount they could invoice over this could bankrupt small advisers for something they didn’t do. The CSLR is taxation without representation and the industry should “hurl our tea into the sea” and refuse to pay it. We have no representation on AFCA, no respect from the regulator and no say in what is paid.
Investors should get their money back but advisers who did nothing wrong should refuse to pay.
Asic only like low hanging fruit like TMDs that nobody reads
You know, I’ve been reading all these comments with everyone having their two cents, and what it really shows me is how misinformed people are. If you actually watched the program properly, you’d know this: ASIC had a report back in 2022 where they were specifically told they needed to investigate those two individuals David & Simone and they didn’t.
Had ASIC acted in 2022, no one would have lost their money. Full stop.
Ferras Merhi would never have encouraged anyone to put their funds into First Guardian or Shield if he had known those two people were taking money that wasn’t rightfully theirs. And if people actually listened to his interview, they’d know there was a third-party checklist in place — everything he was doing was being independently checked and confirmed.
open your minds, people: he’s the only one out of everyone being investigated who has the guts to go on national TV and tell his truth. What person who has taken even a single dollar that wasn’t rightfully theirs would put themselves in that position?
The reality is simple: if ASIC had done their job and the four major banks had done their due diligence, those 1,200 people would never have lost their super. But once again, ASIC refuses to take responsibility. Instead, they’re trying to pin everything on Ferras Merhi.
Anyone who actually knows Ferras knows he’s honest and upfront. We stand with him. The truth will come out — Time will expose who the real fraudsters are. And for everyone posting here without understanding the facts: take the time to listen, read, and actually understand.
Don’t be stupid!
I hope every single person who has been affected by this receives every dollar back!
Ferras Merhi went on national TV to expose the system and to bring public awareness of this and he is hoping putting pressure on ASIC will help eventuate all money being returned back to customers!
ASIC you failed! You had a report in 2022 and you failed to act!
Keep fighting Ferras! Keep standing tall!
Sorry but what kind of financial adviser recommends a so called diversified fund that is new as the sole investment let alone the core that isn’t actually a broad based diversified portfolio across all major asset classes unless there was an angle to get comms…illegally? What were the underlying investments? If just direct property or even worse private property credit than at best he is negligent and at worst (which I suspect) he is implicit. Why not just run the same biz model with real reputable fund managers? Let me guess…they wouldn’t pay the so called marketing fees. Mind you the super platform trustees definitely should have imposed limits on % holdings unless meets strict criteria ie broad based diversified listed assets l. This ain’t rocket science but now over a billion lost that I gotta write a cheque out for. And ASIC…seriously what’s the point in reporting this stuff to you to you? I genuinely want to know when what and how and what you actually did because not only am I paying for this self funded model but all of our clients are as well. You charge us to regulate us. You then charge us to prosecute bad actors. When you lose court actions we pay. When you win the collected funds go to consolidated revenue and do no offset. When managed investment schemes fail that are under your remit the cslr is the only means to compensate. Clients of poor advice should be compensated by the the profession as a last resort not a first resort. Get funds from 1 mis operators and re’s 2 auditors that’s signed off on stay reqs to remain a registeredbmis 3 super trustees that allowed more than 20% exposure to unproven and unlisted investment 4 ASIC / govt if mis regulations not enforced and allowed to persist and proven that were notified well in advance and allowed to continue 5 I guess myself and fellow advisers will pick up the tab and factor in our cost to serve our valued clients. For those people that got stung by this I sincerely apologise and you deserve better. I’m pretty sure I got cold called at least 5 times for a super check up and even when I said I was a financial adviser they kept going with their script.
Yep.
Regardless of anything else whatsoever, the concentration risk (one fund) was insane for an Adviser to have recommended.
12,000 people not 1,200. Read, get the facts right! Macquarie and Interprac failed to do their due diligence, basic compliance checks and governance oversight. They failed and will have to take full responsibility.
Great comment Garry Crole or other Interprac employee or Ferras’s mom? Why did Ferras go on TV and show us how incompetent he really is will be the story for a book he has probably written to tell the world how he got done over by others and he is really is a nice guy. The book will come out soon to fund the court battle. His motivation for the interview or for what he did is not relevant. He did it and now he must deal with the consequence. Will the advisers who went through Venture Egg and stayed for more than a week once they understood they were in a boiler room to flog a product be employable now and will they be banned by ASIC at some point too? AND what we have not heard about yet is how and why did Merhi get his own AFSL and have that running while also being licensed by Interprac. Was this separate AFSL simply a strategy to move affected clients to reduce liability for Interprac?
These hard working Australians were induced to switch funds based on higher returns. The SOA’s that Ferris (and his team of advisers – who seem to be avoiding scrutiny) issued were flawed, did not meet best interest duty and Ferris was induced to have people switch their funds based on the Marketing fees he was receiving from the funds he was switching clients into.
Its pretty clear cut
He was charging exorbitant upfront fees to people that had very small balances, it wasn’t just that they have lost money, its that they were overcharged all along the way too! This he is trying to help is just utter nonsense. Asic cant get anyones money back! Thats not what they do.
He will not get away with playing dumb on this one, when this goes through the courts we will see who is standing tall then!
What a joke of a comment , probably coming from a friend or associate of his. Wake up!
I agree whole-heartedly. God forbids he loses more than he has lost already. ASIC is negligent. Full stop. And should be dragged into a commission set up to not only check it out but lay charges of necessary.
Big effort there, but it doesn’t wash.
The biggest cookie cutter money can buy with massive conflicted incentives paid to get everyone into the same platforms???
You are pathetically delusional.
Ferras Merhi went on national television because he is now faced with the biggest sale of his life, the sale of himself for some sort of fake redemption.
Please cease these ridiculous fan club responses.
Can you please confirm if Ferras Merhi successfully completed the Ethics course ?
Approved ethics course not required under the 10+ years of experience exemption.
You are kidding right? Where were the exorbitant commissions coming from? People hard earned. Greed is not good.
Total garbage, why were they only directing clients to funds paying them huge payments, pure greed. Its still an advisers responsibility under best interest to know product, its not self interest. If anyone bothered to look under the hood, you had a retail funds investing into 4 wholesale funds that were totally conflicted and illegal in terms of disclosure. The so called fixed income fund was a single debt note lending back to related development parties. He deserves jail, the only people that matter are the one he prayed on.
But what about the people who have lost everything? Merhi can peddle a sob story and ASIC can claim it wasn’t dragging its feet what about the 1200 people who have slugged their guts out, saved, salary sacrificed etc. in the hopes of have a modest retirement? What are they to do?
The lawyers and liquidators will make a killing, the politicians will have their sound bites and point scoring, no doubt there will be new regulations the cost of which will be passed directly to the customer, but what is being done for the victims?
You’re absolutely right — the people who lost everything are the real victims here. They worked hard, saved, salary sacrificed, and trusted the system to protect them. And that’s exactly why this makes me so angry: because the system failed them.
ASIC had the report in 2022. They were told to investigate those two individuals and they didn’t. If they had acted then, those 1,200 people wouldn’t have lost their super. The four major banks also had a duty to do their due diligence, and they failed too.
Instead of fixing their own failures, ASIC and others are now trying to deflect and put all the blame on Merhi — a man who had third-party compliance checks in place and who was upfront enough to go on national TV and face the music. Ask yourself, what fraudster would willingly put themselves in that position?
The lawyers, liquidators, and politicians might all end up profiting from this disaster, but that doesn’t change the fact: the victims were let down by the regulators and the banks. They deserve justice, not just lip service. And the starting point of that justice is accountability from the bodies that were meant to protect them.
You ask what’s being done for the victims. The truth is, the only reason this is even coming to light and conversations are being had is because Firas Mohi had the courage to go on national TV and expose the system.
When someone shines a spotlight on the failures of ASIC and the banks, it forces those in positions of authority higher than ASIC to start asking the hard questions about what went wrong. Without that, this would have been swept under the rug and the victims would have been left completely voiceless.
Just to clarify. Its 12,000 people who are affected
Thank you for the clarification. Yes 12,000 it shouldn’t have happened to even one!
Stop making Firas look like some kind of hero. What type of adviser, in 2025, takes such a cookie cutter approach and funnels so many clients into one fund while receiving kickbacks? It reeks of conflicted remuneration and self interest over the best interests of clients.
Besides the retirees, who are the the real victims, this saga will undo so much of the trust that has taken years to rebuild since the Royal Commission and leave people questioning whether they can trust the majority of advisors who do the right thing.
The Compensation of Last Resort fund will be exhausted. But first Interprac, Macquarie, All these advisors involved should be forced to pay these losses. If only ASIC wasn’t fast asleep.
The claim 1.2B is lost is false- the true loss won’t be realised for sometime despite the hyperbole in media. There is a chance clients may get back more, although no one will know just yet. No one has once mentioned a real loss of 1.1B was actually realised albeit amortised by many more of the members of Australian Super when they had a failed investment in Pluralsight. There is much rhetoric from large fund advocates claiming they are rock solid when in fact the opposite is true. This goes to show that both sides those who advocate for large industry funds and platform advocates alike both have their own biases and the unfortunate client in the middle is in a dilemma where they are unsure of which voice to trust- The good planners, the unfortunate mum and dads who were mislead and the whistle blowers who called it all out are ones who are the most let down.
The opportunity losses will bring this to more like $4-$5billion in 5-6 years time. The emotional damage on individuals and families will be unmeasurable. Yet the Australian government is doing little to nothing to support these 12,000 people. Yet the ATO still taxed them on these contributions and will be taxing their funds well into retirement. The system is a total failure! Super can’t be mandatory if the regulator, government and the oversight organisations fail.
The most unethical of all these organisations is Interprac! They were making profits but failed to do due diligence, governance oversight and no alarm bells went off when a company like Venture Egg invested / stolen / channeled $1.2 billion under their license in funds that don’t meet the minimum requirements for any big super fund to even consider. Then to try and buy face, they appoints the former ASIC Commissioner under whose watch this mess occurred to an extra layer of governance now with them. This is an actual conflict of interest and just demonstrates this organisation has no clue what good corporate governance is. Jail time for their CEO and every Board member are the bare minimum. Interesting their share price hasn’t collapsed yet, but it surely is coming.
100% agree Interprac and Sequoia allowed this to happen, and not just that, they’re also embroiled in this through the Morrison sale to NQ Super using First Guardian funds.
It was Shield money not First Guardian
Not sure they’re the most unethical. SQM Research rated both First Guardian and Shield as investable. Shouldn’t SQM have done the due diligence? Most licensees outsource that to Lonsec, Zenith, SQM ect.
Hard to be an expert in everything so outsource to “experts”.
Whether you are Interprac, the platforms, the ratings agency or the auditor, or even ASIC, you are not going to prevent fraud conducted by determined and greedy operators. In fact, that group will always be the last to know. Their only hope is to have systems and processes in place that halt the fraud in its early stages, which obviously didn’t happen here. Interprac as the licenser of hundreds of practices, is never going to be the first to identify fraud. And is not closest to the coal face. Whenever you have shysters offering unrealistic returns, and investors happy to lap them up, this sort of thing with will never go away.
True and fraud cannot be stopped because greed is real and greed is bad (not “greed is good” like the famous quote from the Wall Street film). However, we have a system designed to stop fraud like this before it gets to this level. ASIC failed here, but the first filter was Interprac who allowed and still allow practices under their AFSL to use these call centre, super product comparison or boiler room business models to rope in investors. While the failure here relates to the funds that blew up and have the attention, what are the other practices doing and what products are they using? How many other products yet to blow up will get exposed. Apparently, the CEO of Interprac also ran his own funds with microcap stocks he promoted through the interprac advisers. Let’s see what comes up from that because I fear this will get much worse before it gets any better.
Then Interprac shouldn’t have a license to operate if they don’t have governance oversight! If your argument is holding, then all Super Funds from investors in Australia are significantly exposed to fraud / pilfering. Interprac is the oversight body and Venture Eggs operated under them. They are fully accountable as they failed their responsibility on an epic scale! They’ll be dragged through the courts until they fold eventually as the claims are coming like a tsunami! It is clear they’re unethical, as they were providing investors links to the class action against Macquarie to try taking the spotlight off them.
The class action against Macquarie by Banton Group should win as Macquarie owed clients protections under APRA Prudential Standard SPS 530. Same with Equity Trustees and ASIC has already taken legal action there.
Typically a comment from an Interprac advisor in denial! Why has none of the other big super funds in Australia allowed this under their license? Because they got ethics, governance and oversight above profits.
Asic knew about the issues so did the platforms and the rating agency. Interprac were happy while they were all making money. Did no one ever question the investments they chose, what was the methodology behind it. Interprac had a linkedin interview with the investment team this very advisers firm that appears to be scrubbed from the internet. how convenient for all but the unfortunate investors
Financial services is back in the spotlight in a way not seen since the Royal Commission circus. Both Channel 7 and Channel 9 running stories on a Sunday night at the same time about Shield and First Guardian.
There were two important stakeholders not referred to in the Channel 7 story – Interprac and the CSLR. It is remarkable that after Sequoia (parent of Interprac), came out last week and blamed everyone else and said we had no way to know, that they got no attention. That is not how financial advice works. The licensee is held responsible for the conduct of their authorised representatives. However you look at the Venture Egg matter, with more than $500m of client money invested in these two products, they are in a lot of trouble. This is a house of cards and there are a lot more cards to fall before this is all over.
Government should have blocked the appointment of the former Commissioner of ASIC to Interprac. Australia is attracting world wide the attention for a total lack of understanding of conflicts of interests and good corporate governance. Worst is this appointment has not attracted attention under this investigation. ASIC’s current leadership should approach government to force this appointment to be terminated immediately. The Interprac Board should be sacked for incompetence to not raise concerns over this appointment. They’re not fit as Board members. The Australian Institute of Company Directors can’t stand by and not raise concerns of this conflict of interest appointment.
True, but surely the auditors, research house and the platform trustees have responsibilities too. Otherwise the precedent of advisers wearing all product failures will be set.
I read just one his SOA…..I told the client to give it a miss.
As a very experienced & old Adviser I say….. good riddance. Don’t let that door slam ya on the way out. I hope jail time is the outcome.
What about my reporting obligations ? Well…. tried online, made a call, ASIC laughed at me, ….and then I got a mini ASIC audit. Thankfully they got closed down 9 months later, but I loose sleep thinking i should have pushed harder…but what did I get..I got audited by ASIC.
We have plenty of laws and regulations to protect consumers, what needs to change is the Adversarial regulator that wants to eliminate Advisers full stop. ASIC needs to be held accountable.
thank you for trying
I’ve been told by someone who used to work at ASIC to always complain on an anonymous basis. Doing it under you own name apparently often gets a “review” on the basis they think you are trying to hide something yourself by complaining about someone else’s poor advice. Whilst others are also to blame a fair portion of the blame for this fiasco needs to sit with ASIC — they simply weren’t doing their job.
I also tried. Saw two Statements of Advice for very different client types. The ‘advice’ was almost identical. They clearly broke countless laws – but the one that will get prosecuted the hardest is the one that makes all other advisers have to pay.
Why is our system of governance so broken?
The nerve of Merhi to suggest that he is a victim too and was lied to by others is offensive. You did not know that your employed sales agents (not financial planners) were moving unsuspecting “clients” 100% into these scam funds that were paying you illegal marketing incentives was a problem? Jail for Merhi and everyone involved is a MUST. How did Merhi think going on TV and being interviewed would help his case as this amazing “whistleblower”? Should have listened to your lawyers!
“But, but..All those millions went to google ads!” ..lol
Chasing & permanently banning a financial planner for alleged insurance churning using manipulated and incomplete information provided to them. Did not receive upfront & ongoing commissions (employed, ex boss received everything). Did not fail any compliance review in 4yrs of being employed. Financial planner recommended superior new product with more features & benefit and significant lower premiums for clients. Facts!
Ummmm, Mr Merhi most definitely didn’t want people to lose their money and also didn’t likely know of the probolem and ways the money in the funds were being used, but was he not putting together a mass marketing scheme with some friends to make a lot of fast money, providing non-personal advice en masse to clients in huge numbers, using negative consent model, not disclosing conflicts of interest, not providing real service in clients best interests, not actually speaking with and getting to know a clients actual needs, not explaining things in plain english, next to impossible to contact, not disclosing that he was under investigation, and a wide raneg of other things? Mr Merhi is not behind any wrongful spending of the fund managers, but the questions above would mean he had self interests ahead of clients which led to massive some of money going missing for them. Acting above board in the BEST INTERESTS of clients is the job of the financial advisor and that appears to be a HUGE failure.
There are many other levels to this where failures are, from trustees, back room agreements, misappropriation etc etc etc, so yes as he says its NOT all his fault, but HE was clients entry point as his conduct led people into this.
Meanwhile Interprac added these funds to their portfolio for investing, but were so blind to realise that almost $0.5billion flowed into the funds through 1 company in a very short period. Not to mention no other super funds added Shield and First Guardian as the short period of operations wouldn’t allowed them to meet the minimum criteria to invest in. Yet Interprac was after profits above oversight, due diligence and governance. Now suddenly they establish an extra layer of a governance committee. Too little, too late, they failed 12,000 investors and it’s going to cost them over a billion $ in losses, opportunity losses and potential the biggest fine in Australia’s history. That’s if they don’t collapse financially. Their reputation is in tatters.
The products were on major super platforms. Shield was available through Macquarie Super. You know, the Macquarie that’s worth $85 billion.
Need to set higher expectations at the regulators office. Time to implement a Faesa style exam with a 31.12.25 deadline to identify the individuals policing the industry are ethical and competent.
If they don’t have the industry experience to police the industry they need to work a PY year and undertake an 8 unit course at $2k a pop paid not by the taxpayer.
This will lift the standards and quality of policing so the regulator isn’t asleep at the wheel … again……
The Australian has reported that ASIC was warned about First Guardian as early as 2021 by the Financial Advice Association of Australia (FAAA). On top of that, ASIC had been receiving audit reports on First Guardian for years from a deregistered auditor — and still didn’t intervene.
That kind of inaction is staggering. While ASIC sat on warnings and rubber-stamped audits from someone who wasn’t even licensed to practice, billions flowed into Shield and First Guardian. SQM Research was rating Shield Favourable, BDO was signing off, and trustees like Macquarie and Equity Trustees were approving the funds for super platforms. Advisers and clients had every reason to believe the products were legitimate.
Yes, Venture Egg’s advice process was shocking and Merhi deserves scrutiny. But let’s not ignore the bigger failure: ASIC ignored credible warnings in 2021, accepted audits from a deregistered auditor, and let these products stay on the shelf. That systemic breakdown is what turned bad advice into a $1.2bn disaster.
But Merhi had the inside running, didn’t he. He must have known all those illegal millions received were coming out of the funds. That in itself would have put the funds behind the 8-ball. He gets everything he deserves.
No one is denying what Merhi was doing was illegal. The regulator and its over paid minnons shouldn’t get a free pass either. Where is the accountability from these highly funded government services to protect markets and consumers.
The whole system should have a Royal Commission investigation to thoroughly check the regulator and the Super funds, they are ruining people’s lives
Anyone know of other funds spending lots on advertising/marketing?
LOL. Industry inside joke there punters.
Bernie Fraser symbol. Sponsoring AFL sporting teams and paying for corporate boxes count?
Yeh AMP for one!
Ok lawyer! What was he doing that was illegal?
Isn’t it illegal for advisers to spruik financial products / cold call etc?
To get around this they used a 3rd party marketing firm, from his mate Osama Aus Super Compare to cold call / pressure and direct people to Venture Egg, which in turn, Venture Egg and Aus Compare received ridiculously high commissions. It seems the vested interest/ commissions scenario was not disclosed and even denied. Seems like a well orchestrated operation to me.
Uneducated comment! I’m glade your not in a position of authority or maybe you work for ASIC and was asleep during the interview when Sarah Court could not even answer any questions.