First Guardian and Shield Master Fund collapse: what investors should know

What’s the situation?

The Federal Court has recently intervened to freeze the assets of a Melbourne-based financial adviser operating under the name Venture Egg. This action follows serious allegations by ASIC, Australia’s corporate watchdog, that the adviser misused client funds and operated without the proper financial services licence.

Venture Egg was acting as an authorised representative of Interprac Financial Planning Pty Ltd at the time the alleged conduct occurred.

Importantly, Interprac is still listed as a current member of the Australian Financial Complaints Authority (AFCA). This gives affected clients a valuable, but potentially time-limited, opportunity to lodge a formal complaint and seek compensation through AFCA. Once a financial firm ceases to be a member, AFCA can no longer investigate or take action against it. 

That’s why it’s essential to act quickly if you believe you’ve been impacted.

Why does this matter?

Investigators have revealed that Venture Egg advised clients to switch their superannuation into questionable investment products, including the First Guardian Shield Master Fund, which is now also under investigation.

In one reported case, a client had nearly $100,000 of their superannuation invested in this fund, which was subsequently frozen by regulators. The advice was often delivered after unsolicited cold calls and high-pressure sales tactics, with clients being promised unrealistically high returns and no explanation of the associated risks.

What are the options?

If you’ve suffered financial loss due to advice or conduct by Venture Egg or Interprac, you may be eligible to lodge a complaint with AFCA. If AFCA finds in your favour but the firm is unable to pay compensation, you may be able to access the government’s Compensation Scheme of Last Resort.

If you’ve suffered financial loss due to the conduct of Venture Egg or Interprac, you may be entitled to compensation. Here are your options:

1. Lodge a complaint with AFCA:
   You may be eligible to lodge a complaint through AFCA. If they rule in your favour and it’s recognised that the advice you received was inappropriate or unlawful, you may be awarded compensation.
   Please note: AFCA only accepts complaints against current members. Interprac’s status could change, so it's important to act promptly.
   
   
2. Access the Compensation Scheme of Last Resort:
   If your adviser or their licensee is unable to pay the compensation awarded by AFCA, you may be eligible to claim through the government’s Compensation Scheme of Last Resort, which is a safety net for unpaid awards.