When 61-year-old Queensland miner Phil learned his $240,000 retirement nest egg had vanished overnight, he thought his golden years were gone forever.
He's just one of thousands of older Australians caught up in what financial regulators are calling 'misconduct at an industrial scale' - a sophisticated scheme that has put more than $1.2 billion of retirement savings at risk across 12,400 clients.
The good news for some victims came this week when Macquarie Bank announced it would pay back $321 million to 3,000 Shield Master Fund investors by the end of September.
But this represents just the tip of the iceberg in what's shaping up as one of Australia's most devastating superannuation scandals.
In this article
The Shocking Scale of the Collapse
While headlines focused on Macquarie's Shield Master Fund repayment, the reality is far more extensive. The collapse involves three major funds—Shield Master Fund, First Guardian Master Fund, and Australian Fiduciaries—affecting 12,400 clients with $1.2 billion in combined exposure.
Since February 2022, over 5,800 consumers invested more than $480 million into Shield alone, while the First Guardian Master Fund attracted similar amounts. These weren't obscure investment schemes—they were promoted through major superannuation platforms and backed by what appeared to be reputable trustees.
The Collapse By Numbers
12,400+ Australians affected
$1.2 billion total funds at risk
$321 million being repaid by Macquarie
25+ ASIC investigations underway
$37 million allegedly paid to key adviser
The Man Behind the Marketing Machine
At the centre of this scandal sits Melbourne financial adviser Ferras Merhi, who regulators allege orchestrated a sophisticated scheme to funnel retirees' money into doomed investments. Between 2020 and 2024, Merhi and advisers working for him allegedly advised clients to invest around $526 million of their superannuation into the failed funds, while his businesses received nearly $18 million in upfront advice fees and more than $19 million from entities associated with First Guardian for marketing.
The scale is staggering when you consider that a single adviser, Ferras Merhi, is personally responsible for over 8,000 of the investors who put money into these schemes, in an environment where the average clients per adviser is somewhere between 100 and 130.
Travel restraint orders now prevent Merhi from leaving Australia until 12 December 2025, while ASIC seeks to expand civil proceedings against him for alleged unconscionable conduct, failing to act in clients' best interests, and providing defective advice while receiving millions in payments.
'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'
How the Scheme Trapped Thousands
The sophistication of this operation is what makes it particularly troubling for older Australians. ASIC alleges Merhi used marketing companies to push potential clients to his financial advice businesses, employing aggressive telemarketing tactics and social media advertising.
The scheme typically worked like this: Potential victims received cold calls or saw Facebook advertisements promising better returns on their superannuation. These leads were then passed to licensed financial advisers who would recommend switching from established super funds to supposedly safer, higher-returning products.
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.
Many victims believed they were investing in products backed by trusted names. ASIC alleges that Merhi provided clients with statements of advice which contained false or misleading statements about the nature of the Shield Master Fund by implying it was operated by Macquarie.
The Regulatory Crackdown
ASIC's response has been unprecedented in both scale and intensity. The commission has increased investigations by 50 per cent over the past year, which now stands at 252 total investigations—many targeting superannuation-related misconduct.
The regulator hasn't just gone after individual advisers. ASIC has commenced civil proceedings against Equity Trustees alleging failures in due diligence concerning the Shield Master Fund, where Equity Trustees oversaw the investment of around $160 million of retirement savings.
Travel bans and asset freezes now affect multiple key figures, while several advisory firms have had their licenses cancelled. The message is clear: the days of treating retirees' superannuation as easy targets are over.
Why This Matters for Your Retirement
Australia's superannuation system is one of the world's largest, with $4.2 trillion invested as superannuation assets as of December 2024. The mandatory superannuation guarantee contribution is currently 12 per cent, meaning every working Australian is building a retirement nest egg that could become a target for unscrupulous operators.
The Shield and First Guardian collapses highlight how sophisticated modern superannuation scams have become. These weren't obvious get-rich-quick schemes—they were promoted through legitimate-looking platforms, backed by recognisable trustee names, and sold by licensed financial advisers.
Did you know?
Did you know? The Australian superannuation system is so large that it ranks as the world's 5th largest holder of pension fund assets globally. This massive pool of money—equivalent to about twice Australia's annual GDP—inevitably attracts those seeking to exploit it illegitimately.
Warning Signs Every Senior Should Know
Financial experts emphasise several red flags that could have helped Shield and First Guardian victims avoid losing their retirement savings:
Unsolicited Contact: Be immediately suspicious of cold calls, text messages, or emails about your superannuation, especially if they create urgency or pressure you to act quickly.
Unrealistic Promises: Any investment promising guaranteed high returns (especially above 8-10 per cent annually) with little risk should trigger alarm bells. Legitimate investments carry risk, and higher returns always mean higher risk.
Pressure to Switch: Be wary of advisers who recommend switching your entire superannuation to a new fund or platform, especially if they downplay risks or rush the process.
Marketing Payments: Ask direct questions about whether your adviser receives any payments, commissions, or benefits for recommending specific products. Independence is crucial for genuine advice.
Example Scenario
- Margaret, 58, received a Facebook ad promising 'government-approved 9 per cent returns with no risk.' When she called the number, a friendly adviser offered a 'free review' of her super. The adviser recommended switching her $180,000 balance from her industry fund to a 'safer' product. Fortunately, Margaret checked with her existing fund first and discovered the new product was actually much riskier and came with high fees. By asking the right questions, she avoided a potential disaster.
Source: ABC News (Australia) / Youtube.
Protecting Your Superannuation Nest Egg
National Seniors Australia and financial safety experts recommend several practical steps to protect your retirement savings:
Verify Everything: Always check adviser credentials through ASIC's Financial Advisers Register. Ensure they're properly licensed and haven't been subject to regulatory action.
Get Second Opinions: Before making any significant changes to your superannuation, speak to your existing fund's advisers or seek independent financial advice.
Check Fund Performance: Use the Australian Taxation Office's YourSuper comparison tool to see how your fund performs against others. Don't be swayed by promises of dramatically better performance.
Read the Fine Print: Legitimate investment options will have detailed Product Disclosure Statements (PDS) that clearly explain risks, fees, and how your money will be invested.
Trust Your Instincts: If something feels wrong, it probably is. High-pressure tactics, complicated explanations that don't make sense, or reluctance to provide written information are all warning signs.
Getting Help and Support
If you suspect you've been affected by superannuation misconduct, several support options are available:
Australian Financial Complaints Authority (AFCA): Lodge complaints against financial advisers, super funds, or other financial service providers. AFCA's service is free and they have dedicated information for Shield and First Guardian victims.
ASIC's Report Misconduct: Contact ASIC directly if you believe you've encountered superannuation fraud or misconduct. They're actively investigating and appreciate public reports.
Free Financial Counselling: The National Debt Helpline (1800 007 007) provides free, independent financial counselling for Australians experiencing financial difficulty.
Legal Advice: Specialist superannuation lawyers are helping victims pursue compensation from advisers, trustees, and other parties involved in the collapsed funds.
Key Contact Numbers
AFCA complaints: 1800 931 678
National Debt Helpline: 1800 007 007
ASIC Consumer Contact: 1300 300 630
Seniors Information Line: 1800 424 079
All services are free and confidential
The Road to Recovery
While Macquarie's $321 million repayment provides immediate relief for Shield Master Fund investors, the broader recovery process will take years. Liquidators are working to recover what they can from the collapsed funds, while ASIC's investigations may result in additional compensation orders.
The scandal has prompted calls for stronger oversight of superannuation marketing, better protection for older Australians from financial predators, and clearer disclosure of conflicts of interest in financial advice.
Protecting Your Super: Essential Actions
- Never respond to cold calls about your superannuation
- Verify all adviser credentials through ASIC's register
- Get independent second opinions before switching funds
- Use official comparison tools like YourSuper
- Report suspicious activity to ASIC immediately
- Seek free help if you think you've been targeted
The Shield Master Fund scandal serves as a stark reminder that even the most sophisticated scams can target everyday Australians' retirement savings. While regulatory crackdowns are intensifying and some victims are getting their money back, the best protection remains vigilance and informed decision-making.
As you plan for or enjoy your retirement, remember that legitimate superannuation advice should never involve high-pressure tactics, unrealistic promises, or reluctance to provide full disclosure. Your retirement savings have taken decades to build—they deserve protection from those who would exploit your trust.
Have you received suspicious calls or emails about your superannuation? Have you checked your super fund's performance lately? Share your experiences and tips for staying safe in the comments below—your insights could help protect fellow readers from falling victim to the next sophisticated scam.
Original Article
https://www.news.com.au/finance/sup...e/news-story/1f8ea084a647af8c347aff1b209b71b2
5 things to know about shield & first guardian collapse — Scam Victim Alliance
Cited text: The corporate cop ASIC has called this collapse “misconduct at an industrial scale” and taken court action against a range of different entities, from...
Excerpt: 'misconduct at an industrial scale'
https://scamvictimalliance.org.au/r...shield-or-first-guardian-master-fund-collapse
Recovering losses from the First Guardian and Shield Master Fund collapses
Cited text: In total, First Guardian and Shield Master Fund held combined assets of approximately $1.2 billion.
Excerpt: more than $1.2 billion of retirement savings at risk across 12,400 clients
https://www.berrillwatson.com.au/su...r/first-guardian-and-shield-master-collapses/
Collapse of Shield Master Fund, First Guardian and Australian Fiduciaries—Financial Advice Association Australia
Cited text: On 22 June 2025, the AFR published an article on “Lessons from $1.2b funds collapses”, referring to the recent collapses of Shield Master Fund, First ...
Excerpt: more than $1.2 billion of retirement savings at risk across 12,400 clients
https://faaa.au/collapse-of-shield-master-fund-first-guardian-and-australian-fiduciaries/
24-265MR Update for investors in the Shield Master Fund | ASIC
Cited text: ASIC understands that, since February 2022, funds totalling more than $480 million have been invested into Shield by at least 5,800 consumers, who acc...
Excerpt: Since February 2022, over 5,800 consumers invested more than $480 million into Shield alone
https://www.asic.gov.au/about-asic/...date-for-investors-in-the-shield-master-fund/
25-184MR ASIC takes further action against Ferras Merhi over First Guardian and Shield superannuation advice | ASIC
Cited text: Between 2020 and 2024, Mr Merhi and advisers working for him allegedly advised clients to invest around $296 million of their superannuation into the ...
Excerpt: Between 2020 and 2024, Merhi and advisers working for him allegedly advised clients to invest around $526 million of their superannuation into the failed funds, while his businesses received nearly $18 million in upfront advice fees and…
https://www.asic.gov.au/about-asic/...st-guardian-and-shield-superannuation-advice/
25-184MR ASIC takes further action against Ferras Merhi over First Guardian and Shield superannuation advice | ASIC
Cited text: In return, ASIC alleges Mr Merhi’s businesses received: ... more than $19 million from entities associated with First Guardian for marketing First Gua...
Excerpt: Between 2020 and 2024, Merhi and advisers working for him allegedly advised clients to invest around $526 million of their superannuation into the failed funds, while his businesses received nearly $18 million in upfront advice fees and…
https://www.asic.gov.au/about-asic/...st-guardian-and-shield-superannuation-advice/
ASIC turns up heat on financial adviser alleging $37m windfall from failed Guardian and Shield funds
Cited text: In return, ASIC alleges Merhi’s businesses received nearly $18 million in upfront advice fees and more than $19 million from entities associated with ...
Excerpt: Between 2020 and 2024, Merhi and advisers working for him allegedly advised clients to invest around $526 million of their superannuation into the failed funds, while his businesses received nearly $18 million in upfront advice fees and…
https://www.businessnewsaustralia.c...ial-adviser-37m-windfall-guradian-shield.html
Shield and First Guardian marketing payments likely illegal: Abood—ifa
Cited text: “There are only five financial advice firms, at least so far, that ASIC has identified as being involved with these, and a single adviser, a chap call...
Excerpt: a single adviser, Ferras Merhi, is personally responsible for over 8,000 of the investors who put money into these schemes, in an environment where the average clients per adviser is somewhere between 100 and 130
https://www.ifa.com.au/news/36126-shield-and-first-guardian-marketing-payments-likely-illegal-abood
ASIC seeks to expand proceeding against former financial adviser Ferras Merhi—FX News Group
Cited text: In July 2025, the Court made travel restraint orders against Mr Merhi. Those orders prevent him from leaving or attempting to leave Australia until 12...
Excerpt: Travel restraint orders now prevent Merhi from leaving Australia until 12 December 2025
https://fxnewsgroup.com/forex-news/...gainst-former-financial-adviser-ferras-merhi/
25-184MR ASIC takes further action against Ferras Merhi over First Guardian and Shield superannuation advice | ASIC
Cited text: ASIC will seek to allege Mr Merhi used marketing companies to push potential clients to his financial advice businesses, Venture Egg and Financial Ser...
Excerpt: ASIC alleges Merhi used marketing companies to push potential clients to his financial advice businesses
https://www.asic.gov.au/about-asic/...st-guardian-and-shield-superannuation-advice/
25-184MR ASIC takes further action against Ferras Merhi over First Guardian and Shield superannuation advice | ASIC
Cited text: Clients allegedly were led to believe they were receiving independent, tailored advice. Instead, they were allegedly channelled into pre-determined in...
Excerpt: Clients allegedly were led to believe they were receiving independent, tailored advice.
https://www.asic.gov.au/about-asic/...st-guardian-and-shield-superannuation-advice/
ASIC turns up heat on financial adviser alleging $37m windfall from failed Guardian and Shield funds
Cited text: ASIC alleges that Merhi provided clients with statements of advice which contained false or misleading statements about the nature of the Shield Maste...
Excerpt: ASIC alleges that Merhi provided clients with statements of advice which contained false or misleading statements about the nature of the Shield Master Fund by implying it was operated by Macquarie
https://www.businessnewsaustralia.c...ial-adviser-37m-windfall-guradian-shield.html
How to make sure your super funds are safe with these tips | The Senior | Senior
Cited text: The commission has already started 50 per cent more investigations over the past year, which now stands at 252.
Excerpt: The commission has increased investigations by 50 per cent over the past year, which now stands at 252
https://www.thesenior.com.au/story/...re-your-super-funds-are-safe-with-these-tips/
Shield Master Fund | ASIC
Cited text: On 26 August 2025, ASIC commenced civil proceedings against Equity Trustees alleging failures in due diligence concerning the Shield Master Fund (25-1...
Excerpt: ASIC has commenced civil proceedings against Equity Trustees alleging failures in due diligence concerning the Shield Master Fund, where Equity Trustees oversaw the investment of around $160 million of retirement savings
https://www.asic.gov.au/about-asic/...nt/enforcement-activities/shield-master-fund/
Superannuation in Australia—Wikipedia
Cited text: As of 31 December 2024, Australians have AU$4.2 trillion invested as superannuation assets, making Australia as a nation the 5th largest holder of pen...
Excerpt: $4.2 trillion invested as superannuation assets as of December 2024
https://en.wikipedia.org/wiki/Superannuation_in_Australia
Superannuation in Australia—Wikipedia
Cited text: Currently, the mandatory minimum 'guarantee' contribution is set at 12 per cent, having increased from 11.5 per cent on 1 July 2025.
Excerpt: The mandatory superannuation guarantee contribution is currently 12 per cent
https://en.wikipedia.org/wiki/Superannuation_in_Australia
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