What Happened?
You may have seen headlines about the collapse of the Shield Master Fund and the First Guardian Master Fund, which together attracted over $1 billion from thousands of Australians, many of whom invested through superannuation platforms.
The Australian financial markets regulator, ASIC, has raised serious concerns about how these funds were managed — including large loans to companies linked to a former director, missing audited accounts, and money being redirected into risky, illiquid ventures and related businesses. Both Shield and First Guardian eventually froze withdrawals, leaving many investors unable to access their retirement savings, and investigations are ongoing.
Are you affected?
No — you are not exposed to these failed schemes.
A key difference between the collapsed funds and the investments in your portfolio is that yours are held within a managed account structure. Managed accounts (see diagram below) are accompanied by multiple layers of governance and compliance, including those from us, as your adviser, investment committees, asset consultants or investment managers, the platform, and the Responsible Entity, all working together to safeguard your investment.
The Layers of Protection within a Managed Account
- Your Adviser – Financial Planning by Design – As your adviser, we are your first line of defence. We recommend only thoroughly vetted investments & structures aligned with your goals, & are not paid by product issuers, unlike those involved in the scandals. We also regularly review your portfolio to ensure that it continues to remain aligned to our investment philosophy and your specific circumstances.
- Investment Committee – F.P.D Solutions (Aust) Pty Ltd – FPD Solutions is our licensee and they maintain an external investment committee which is ultimately responsible for all investment decisions, based upon research and analysis by an external research house
- Investment Fund Manger – Another critical safeguard is the role of the investment fund manager which researches and recommends underlying funds for inclusions in the managed portfolios. Your fund manager (for example Lonsec or Morningstar) have dedicated investment teams that apply a rigorous process combining qualitative review of people, governance and business alignment with quantitative analysis of performance, risk, fees and exposures. This approach makes it highly unlikely that risky and schemes such as Shield or First Guardian would ever pass the process
- Platform – Your investments are held via a platform (for example HUB24 or Colonial First State) that as a hub and are overseen by a responsible entity – an organisation with it’s own regulatory obligations. They provide another layer of oversight by conducting checks to ensure everything is compliant and properly managed.
Key Takeaways
- Scandals like Shield & First Guardian are unsettling, but they also illustrate the strength of protection around your investments.
- Research, checks and reviews happen at every stage
- Safeguards are in place to protect your investments now and in the long term.
These protections provide confidence that your wealth is being managed responsibly, allowing you to focus on what matters most in life.
If you have any concerns or questions, please contact our office on 1300 014 368 or via email info@fpbydesign.com.au
