A United Path Forward for First Guardian and Shield Victims 

Introduction
Over 12,000 Australians have been devastated by the collapse of the First Guardian and Shield products. Families have lost retirement savings, investors have lost confidence, and yet the regulators and trustees responsible have offered little more than empty words.

This petition sets out a plan of action—a united strategy to hold the responsible parties to account and to ensure victims receive justice. Our strength lies in joining together, speaking with one voice, and demanding a fair outcome.

We are Establishing a Trust & Corporate Entity to centralise and control litigation
We are forming a trust with an associated corporate trustee and a board of victims and professionals who can help.
Beneficiaries: Any investor who has suffered losses from  First Guardian and Shield. This includes investors who were the trustees of their own super fund.
Purpose: To act on behalf of victims, centralising litigation and advocacy, and pursuing recovery from negligent parties.
This ensures control remains with victims, not lawyers or litigation funders.

Securing Funding for the Victims’ Trust
We demand that the Federal Government capitalise the trust with an initial $5 million recovery fund.

Primary Position – Government Responsibility

The Commonwealth Government must accept responsibility for the regulatory failures of ASIC and APRA. Accordingly, it should provide seed funding to ensure victims are not forced to pay twice for systemic failure.

Grounds in law:

Compensation Scheme of Last Resort (CSLR): Established under the Financial Sector Reform (Hayne Royal Commission Response) Act 2020, the CSLR is capped at $150,000 per claimant, excludes trustees/product issuers, and is funded by levies on unrelated AFS licensees. It is inadequate and unfair.
ASIC Act 2001 & Corporations Act 2001: ASIC’s statutory mandate (ASIC Act s.1(2)) includes investor protection and enforcement of Corporations Act duties (s.912A – licensee obligations; s.601ED – managed investment schemes; s.1022A–1022B – disclosure). ASIC received warnings about these products but failed to act. This is a breach of statutory function, if not direct liability.
SIS Act 1993: APRA supervises superannuation trustees, who must comply with statutory covenants in s.52(2), including:
Duty of care, skill and diligence (s.52(2)(b));
Duty to act in the best financial interests of beneficiaries (s.52(2)(c));
Duty to monitor and manage risks (s.52(2)(f)).
APRA failed to enforce these duties, leaving investors exposed.
Australian Financial Complaints Authority (AFCA): The external dispute resolution scheme under the Corporations Act has proven incapable of providing redress in this case. AFCA is unable to handle the sheer volume of victims, does not assist individuals to properly frame complaints, and routinely rejects claims against collapsed entities. It has refused cases on the basis of arbitrary timeframes and requires consumers to nominate the correct respondent when the reality is that the entire financial services ecosystem failed, not a single identifiable entity. This shows that AFCA is structurally unsuited to deal with systemic product collapses.

ASIC’s litigation cannot deliver compensation: Pecuniary penalties (s.1317G Corporations Act) flow to government revenue, not victims. Compensation orders (s.1317H) are discretionary and rarely pursued.

Alternative Position – Industry Levy Through Superannuation

If the Government refuses to fund recovery, we will approach existing industry participants on the basis that if our approach fails, they will have to pay into the Compensation Scheme of Last Resort (CSLR) in any case. We believe many industry participants will be motivated to help us now, so we don’t have to claim from them later.  If they do help, we should also lobby to stop this from every happening again. We should pursue an industry-based funding solution that is fairer than the CSLR.

Problem with CSLR:
Invoices compliant advisers who were not involved.
Provides no governance role for those who pay.
Does not address product failures.
Payments are capped at $150,000.
It is manifestly underfunded and cannot address systemic product failures.
Alternative – A Superannuation Levy:
Australia’s super system exceeds $4 trillion.
A levy of just 1 basis point (0.02%) would raise $800 million annually.
This would fully fund compensation for fraud, misconduct, and trustee failure.
Burden is spread across all members, who:
Already benefit from tax concessions on super earnings;
Rely on trust in the system;
Have a shared interest in preventing systemic collapse.
Principle: Superannuation is a compulsory, tax-advantaged savings system. In exchange for those concessions, funds should contribute to a universal protection mechanism ensuring no member is left destitute due to misconduct, negligence or fraud.

Targeting Negligent Trustees and Platforms
The trust’s primary legal objective will be to sue the platform trustees who allowed these products to be offered.

Trustees are bound by the SIS Act s.52(2) covenants, including duties of prudence, diligence, and acting in members’ best financial interests.
Trustees failed to vet, monitor, or remove unsafe products such as First Guardian and Shield.
These failures amount to breach of trust and breach of statutory covenants.
If trustees cannot discharge these duties, they should not exist. Litigation should be directed against them first. Bad advice or not, these products should have never been made available to superannuation members. It has become apparent from liquidator reports that the investments within these products were plainly inappropriate, and trustees either never looked or didn’t understand what they were looking at. If platforms do not have the resources to adequately monitor the movement of money within these schemes, they should not exist.

On Advisers and Marketing Companies

It is important to address the role of advisers and marketing groups in this collapse.

Many victims were introduced to these products through advisers or marketing channels. Some advice may have been poor, conflicted, or even reprehensible.
However, advice quality is irrelevant when assessing the primary reason for the losses: these products should never have been permitted onto superannuation platforms in the first place.
Trustees restrict investors from accessing small companies outside the ASX 300 on the grounds of risk and compliance. Yet somehow, these same trustees facilitated and hosted the transfer of billions into products that were misleading, speculative, and highly likely to fail.
Advisers should not be considered harmless — but they are incidental compared to the systemic failure of trustee oversight and licensee determination to approve a product for use. The gatekeepers who control what products can and cannot enter the superannuation system failed in their duty.
 

Pursuing Licensee Liability – Sequoia & Interprac
The corporate licensee responsible—Interprac, owned by Sequoia (SEQ)—also bears responsibility.

Under Corporations Act s.912A, AFS licensees must:
Provide services efficiently, honestly and fairly (s.912A(1)(a));
Maintain adequate financial and human resources (s.912A(1)(d));
Have adequate risk management systems (s.912A(1)(h)).
Interprac failed to resource its compliance functions adequately and did not maintain a safe Approved Product List (APL).
SEQ, as controlling shareholder, extracted profits rather than ensuring compliance capacity. This constitutes a direct breach of s.912A obligations and grounds for liability. We should ensure that SEQ is not able to avoid or minimise it’s liability by closing Interprac.
 

Why This Strategy Matters
Class actions are not enough: They deduct large fees and force victims to fund litigation caused by regulator and trustee failures.
Government accountability: Canberra must accept that ASIC and APRA’s failures contributed directly to investor harm.
Unity of victims: A single discretionary trust can act on behalf of all members. If 12,000 people support this action, we will have the scale, power, and legitimacy to demand compensation and change.
The harm caused is significant: Some investors have lost more than 5 years of their contributions; others have lost their entire savings so close to retirement. The failure was systemic – research houses, advisers, licensees, trustees, auditors and regulators all failed to protect investors from a fund manager that was speculating on start-up companies, undeveloped land options, speculative offshore ventures, and worse. Qualified persons who inspected the asset list immediately identified that these investments were wholly inappropriate and highly likely to fail. Collectively, every part of the value chain failed. They owed a duty of care, they breached that duty, and investors suffered losses.

Our Next Steps
Form an interim steering committee of impacted investors.
Establish the discretionary trust and corporate vehicle.
Launch a petition demanding $5 million government capitalisation (or a superannuation levy alternative) and approach industry participants to raise money.
Interview legal partners and establish a panel.
Begin preparing legal actions against trustees, SEQ/Interprac, and other parties.
Build a united communications platform to keep all 12,000 investors informed and engaged.
Call to Action
If you are one of the 12,000 investors harmed, this is your chance to fight back—not just for yourself, but for every Australian who trusts our financial system to protect their retirement savings.

Together, we can force accountability, demand justice, and ensure that what happened to Shield and First Guardian victims can never happen again.