ASIC launches action against Equity Trustees for $65m First Guardian failures

ASIC has commenced civil penalty proceedings in the Federal Court against Equity Trustees Superannuation (ETSL), alleging failures in care, skill and diligence concerning the decision to allow members to invest in the First Guardian Master Fund.

This comes after the regulator also launched separate proceedings against Equity Trustees in August 2025, alleging failures in due diligence concerning the Shield Master Fund which oversaw around $160 million of retirement savings into Shield through its fund.

ASIC said over $65 million was invested in First Guardian between June 2023 and March 2024 by around 2700 members of NQ Super & Pension, a division of the AMG Superannuation Fund for which Equity Trustees was the trustee.

ASIC alleges Equity Trustees did not obtain critical information before onboarding First Guardian such as its constitution, audited financial accounts or an audit of its compliance plan. Further, ASIC alleges that Equity Trustees allowed its members to invest 100% of their funds in First Guardian despite evidence it was or may have been illiquid.

ASIC is also seeking compensation for members for losses resulting from the alleged failures by Equity Trustees in relation to First Guardian, as well as declarations and civil penalties.

ASIC deputy chair Sarah Court said the latest action is part of ASIC's 2026 enforcement priority into the collapse of First Guardian and related funds.

"We allege that a prudent superannuation trustee in Equity Trustees' position would not have approved the First Guardian classes as investment options based on the information it had available," Court said.

"Superannuation trustees play a critical role helping their members save for retirement, but we allege Equity Trustees failed to put the interests of their members first."

In response to ASIC's fresh action, Equity Trustees said it intends to defend the proceedings.

"We have previously advised the market that ETSL has exposure to the First Guardian Master Fund and the ETSL board intends to defend the allegations," Equity Trustees managing director Mick O'Brien said.

"As with the Shield Master Fund, we believe ETSL acted in line with its fiduciary duties and obligations under the Corporations Act and Superannuation Industry (Supervision) Act. We believe that First Guardian is primarily a case of alleged and widespread fraud, and that the focus should be on those parties.

"The actions by regulators and government to expose the misconduct of now-banned financial advisers and allegedly fraudulent promoters, responsible entities and investment managers are commendable, as are the initiatives to strengthen consumer protections."

O'Brien added Equity Trustees is assisting the liquidators of First Guardian to achieve the best possible returns for members.

"ETSL also fully understands the deeply distressing circumstances for those affected and continues to provide members' access to counselling, wellbeing support and information," O'Brien added.

In all, ASIC alleges Equity Trustees failed to exercise the same degree of care, skill and diligence as a prudent superannuation trustee would in onboarding the different classes of First Guardian; failed to act in the best financial interests of members when performing its duties and exercising its powers in relation to First Guardian; and failed to do all things necessary to ensure the financial services covered by its Australian financial services licence were provided efficiently, honestly and fairly.

"This is the second action we've taken against Equity Trustees and the fifth against a super trustee as part of our First Guardian and Shield Master Fund investigations, Court said.

"ASIC has now commenced proceedings against every super trustee that made available Shield or First Guardian. More than $420 million has been repaid to thousands of investors through ASIC's work to date. We currently have more than 26 matters under investigation or before the Federal Court and we expect further action to follow."

Following ASIC launching its initial proceedings against Equity Trustees last year, it determined to make an application to the government under Part 23 of the SIS Act for help in making First Guardian and Shield investors whole.

"Part 23 of the SIS Act is designed for exactly these purposes, and we look forward to the various authorities prioritising action which establishes that such a fraud occurred," said at the time.

In February this year Equity Trustees placed its superannuation arm under review as it continues to face scrutiny over the Shield and First Guardian failures.