Retirees’ lifelong savings of $1.2 billion at risk in shocking super fund collapse

Thousands of Australians are facing a nightmare scenario with their retirement savings trapped in collapsed super funds.

New allegations suggest a Melbourne financial adviser may have concealed millions in offshore accounts while guiding clients into risky investments.

The full scale of what regulators call 'misconduct on an industrial scale' is only now coming to light.

The corporate regulator, ASIC, has accused Ferras Merhi of hiding his interest in a Cayman Islands company that received millions of dollars linked to the failed Shield and First Guardian super funds.

Since a disclosure order came into effect in February 2025, Merhi has allegedly only revealed assets after ASIC discovered them, the Federal Court heard.

Among the concealed assets was NexOasis Consulting Inc., a Cayman Islands company holding substantial funds connected to the collapsed superannuation entities.

The fallout from these alleged actions has left around 6,000 investors with combined losses of $1.2 billion, highlighting the human cost of the financial collapse.

ASIC has moved to expand its case against Merhi, securing Federal Court approval in September 2025 to include claims of unconscionable conduct and systematic client deception.

The regulator alleges that between 2020 and 2024, Merhi and his advisers directed clients to invest approximately $296 million into First Guardian and $230 million into Shield.

Merhi is also accused of taking loans from First Guardian to purchase his advice businesses, with loan amounts far exceeding the purchase prices, suggesting a network of financial arrangements designed to extract maximum value from the funds.

ASIC claims Merhi operated a sophisticated marketing network funneling retirees’ savings into risky investments.

The regulator alleges Merhi used marketing companies to generate leads for his financial advice businesses, Venture Egg and Financial Services Group Australia, while owning 'honeypot' websites and call centres to convert inquiries into clients.

ASIC further alleges that statements of advice provided to clients contained false information about Shield, implying it was operated by Macquarie—a claim providing false reassurance about investment safety.

Merhi’s businesses reportedly received nearly $18 million in upfront advice fees and more than $19 million from entities linked to First Guardian for marketing the fund.

Merhi has disputed the characterisation of these payments, saying that 'most of that money is with Google and social media' and 'I didn't pocket this money. It's not in my pocket. It's money that was spent on these ads'.

The Federal Court has tightened restrictions around Merhi throughout 2025, imposing travel restraint orders until 12 December 2025 and freezing his property assets since February.

ASIC alleges Merhi regularly failed to disclose assets, including overseas holdings, until the regulator discovered them and continued making unsubstantiated expense claims under the asset freeze.

Others linked to Merhi’s network have also faced court action. Osama Saad, former director of lead-generating marketing companies Aus Super Compare and Atlas Marketing, is subject to travel restraints and asset freezes.

The human impact of the super fund collapses is severe, particularly for retirees and those approaching retirement, who are unable to access their savings while liquidators determine remaining assets.

Withdrawals from First Guardian have been suspended since May 2024, leaving investors in limbo.

Recovery proposals have been floated, including a plan by Paul Chiodo, director of the Shield Master Fund’s responsible entity, to return investor capital 'before Christmas', though ASIC has denied involvement.

ASIC Deputy Chair Sarah Court warned the conduct had 'a devastating impact on people's lives', highlighting weaknesses in the superannuation industry’s ability to regulate complex investment structures.

Consumer alerts issued by ASIC caution about being enticed into complex and risky schemes, suggesting this may be part of a broader pattern of concerning conduct.

The scale of the alleged scheme—including offshore companies, marketing networks, and multiple advisory businesses—illustrates the challenge regulators face in protecting consumers from sophisticated financial misconduct.

ASIC investigations into matters connected to Shield and First Guardian continue, with the possibility of more revelations ahead.

If the expanded case is approved, ASIC will seek injunctions preventing Merhi from involvement in financial services and appoint receivers to manage his personal property.

For those wanting a more detailed look at the Shield and First Guardian super fund collapses, there’s a comprehensive story that explores the full scale of the scandal.

It examines how mismanagement and misleading advice left thousands scrambling to protect their retirement savings and navigate recovery efforts.

Reading this piece can help highlight warning signs and lessons for anyone managing or investing in super funds, offering practical guidance on safeguarding retirement money.

Read more: Macquarie’s $321 million lifeline: Inside Australia’s biggest super scandal that left thousands of retirees scrambling

Have you been affected by the collapse of Shield or First Guardian super funds?