Thousands of Australians were exposed to poor financial advice and significant risks from the Shield Master Fund (Shield) and First Guardian Master Fund (First Guardian) through critical oversight and compliance failures by Interprac Financial Planning Pty Ltd (Interprac), ASIC alleges in new proceedings filed today with the Federal Court.

ASIC has commenced civil penalty proceedings in the Federal Court against Interprac for allegedly failing to ensure its former authorised representatives Venture Egg (a corporate partnership), and Rhys Reilly Pty Ltd (together, Representatives), complied with the best interests obligations and for failing to have adequate risk management systems.

Together, these Representatives advised around 6,843 clients to invest around $677 million of their superannuation into Shield and First Guardian. Both funds have now collapsed, leaving people’s superannuation at risk.

ASIC alleges Interprac failed to:

• have in place an adequate process for approving financial products it allowed onto its approved product list, including Shield and First Guardian, and relied entirely on external research to add those funds to its approved investments list for advisers;
• respond appropriately to the use of lead generators (being Imperial Capital Group Australia Pty Ltd and AGAT Business Pty Ltd (in liquidation));
• respond adequately to news that payments had been made to Mr Ferras Merhi’s companies by entities associated with First Guardian and Shield;
• enforce or maintain a hold on new investments into Shield and First Guardian after Interprac’s Managing Director and Responsible Manager, Garry Crole, acknowledged serious issues with both funds;
• prevent the use of a ‘negative consent’ practice, which led to some clients’ superannuation being invested in Shield and/or First Guardian without express consent from those clients;
• respond adequately to significant inflows of investment into Shield and First Guardian;
• provide adequate responses to client complaints about advice from the Representatives to invest in Shield or First Guardian and instead relied on a ‘template’ response which often failed to consider the appropriateness of the advice; and
• respond adequately or impose meaningful consequences in response to serious compliance issues, including failings repeatedly identified in audits.

ASIC Deputy Chair Sarah Court said ‘Interprac’s alleged oversight and compliance failures exposed thousands of Australians to poor advice and significant financial risk.

‘We allege Interprac failed to ensure certain authorised representatives acted in their clients’ best interests, contributing to hundreds of millions of dollars of superannuation being invested in products that were unsuitable, high risk and costly.

‘We allege that no competent financial adviser could have recommended Australians invest large amounts of their superannuation in these funds, and that Interprac – as licensee – should have been alert and responsive to the significant risk this conduct posed to clients, but it failed on many levels,’ the Deputy Chair said.

ASIC is seeking declarations, civil penalties, and orders to restrain Interprac from carrying on a financial services business.

Background

Effective 31 May 2025, Mr Ferras Merhi and Venture Egg are no longer authorised representatives of Interprac.

Effective 15 August 2025, Mr Rhys Reilly and Rhys Reilly Pty Ltd are no longer authorised representatives of Interprac.

ASIC has commenced separate proceedings against Ferras Merhi over Shield and First Guardian (25-184MR).

ASIC has secured Federal Court interim orders restraining Ferras Merhi from operating within the financial services industry (25-249MR).

Downloads

Originating Process (PDF 522 KB)

Concise Statement (PDF 564 KB)

Editor's note 1:

The matter has been listed for a case management hearing at 10:00am on 12 December 2025.

Consumer information

ASIC has issued a consumer alert warning amid increasing concerns that people are being enticed to invest their retirement savings into complex and risky schemes (25-120MR Consumer alert). Be super smart, visit ASIC’s Moneysmart campaign page.

Stay Updated: ASIC will post important updates on its dedicated webpages: Shield Master Fund and the First Guardian Master Fund.