ASIC moves further on First Guardian MIS | Australian Markets

The Australian Safety and Investments Fee (ASIC’s) investigation of the Defend Funds and different managed investment schemes took one other step late on Monday when the regulator utilized for the appointment of liquidators to Falcon Capital Restricted, the accountable entity for the First Guardian Grasp Fund.

In doing so, ASIC has indicated that it has additional to maneuver with respect to shifting in opposition to these liable for the financial advice supplied across the Defend Funds and people who employed the lead mills which led to the supply of that advice.

ASIC defined the background of its transfer in opposition to First Guardian, noting that it’s a managed investment scheme (MIS) and the legal processes it had already put in movement.

It famous that n 18 February, the Federal Court docket made interim orders on the applying of ASIC freezing sure property of financial adviser, Ferras Merhi in reference to its investigations regarding sure managed investment schemes together with First Guardian.

“Mr Merhi controls Venture Egg Financial Services Pty Ltd (formerly Ferras Merhi Pty Ltd) & United Financial Advice Pty Ltd, trading as Venture Egg and Financial Services Group Australia Pty Ltd (FSGA). Both Venture Egg and Mr Merhi are authorised representatives of Interprac Financial Planning Pty Ltd, an Australian Financial Services Licence (AFSL) holder. FSGA also holds an AFSL,” ASIC mentioned.

“On 18 February 2025, the Federal Court docket made interim orders on the applying of ASIC freezing sure property of Osama Saad, former director of Aus Tremendous Evaluate Pty Ltd (in liquidation) and Atlas Advertising Pty Ltd (in liquidation) in reference to its investigations regarding sure managed investment schemes together with First Guardian.

On 24 February 2025, the Federal Court docket made interim orders freezing the property of Falcon, First Guardian and Mr Anderson. These orders had been prolonged by the Federal Court docket on 27 February, 12 March 2025 and 17 March 2025.

On 11 March 2025, Falcon revealed an replace to its buyers in regards to the freezing orders obtained by ASIC and said it was presently working with its advisers to develop a plan to implement an orderly wind down of First Guardian.

ASIC mentioned it’s involved concerning the management and operation of First Guardian and the related risk to buyers, noting that withdrawals from First Guardian have been suspended with restricted exceptions since Might final yr.

ASIC has alleged that:

• roughly $274 million of First Guardian’s worth arises from money receivables in respect of which funds are many months late;
• in extra of $23 million of First Guardian’s property seem to have been paid to entities purportedly offering advertising and marketing companies which seems opposite to representations made to buyers;
• First Guardian has invested in entities which Mr Anderson had an affiliation with or financial curiosity in and Falcon seems to have did not recognise and handle consequent conflicts of curiosity;
• buyers might have been uncovered to courses of property that differ from what was disclosed to them on the time of making their investment; and
• buyers might have been misled concerning the security of their investment and certain returns.