Equity Trustees Admits It Broke Its Own Rules on First Guardian Fund
Synopsis
Equity Trustees admitted it breached its own approval process for First Guardian, as ASIC pursues civil penalties over alleged due diligence failures involving member investments.
Equity Trustees agreed it violated its own governance principles while managing the First Guardian fund, when they misclassified the investment and overlooked a requirement to clear the fund with a Board of Trustees due to the presence of illiquid assets.
The admission was made when the trustee faced civil penalty proceedings brought by the Australian Securities and Investments Commission (ASIC).
First Guardian Approval Came Without Required Checks
The corporate regulator said Equity Trustees failed to obtain key information prior to approving First Guardian, such as the fund's constitution, its audited financial accounts and the audit of its compliance-plan.
ASIC's data shows that approximately 2,700 NQ Super & Pension members invested over $65 million between June 2023 and March 2024. The regulator says the standard of care and diligence that Equity Trustees showed when making the fund available to members was not required.
It is seeking compensation to be paid to affected members, declarations and civil penalties. The Federal Court has not found the allegations to be true.
Investment products that were subjected to greater scrutiny after investors couldn't access their money included the First Guardian Master Fund. First Guardian and Shield are considered ASIC priorities for enforcement action.
ASIC Review Finds Wider Platform Governance Problems
This case is brought at the same time as ASIC is reviewing the ways trustees of superannuation funds manage investment risks on platform websites.
ASIC analysed six platform trustees on behalf of $305 billion in member benefits and 977,000 member accounts as at December 2025 in its Report 833: Safeguarding super: How well are platform trustees monitoring risks to retirement savings?
The report by ASIC revealed that investment oversight, governance and monitoring practices were weak. The regulator has also begun action against trustees who gave access to First Guardian or Shield to members.
In FY26, Equity Trustees reported $167 million in revenue from continuing operations, which rose 9.4%, and net profit after tax from continuing operations grew 32.7% to $33.9 million.
The company posted $26.4 million of group net profit, which was offset by $7.5 million of loss on discontinued superannuation operations. Equity Trustees have also provided details of expenses for the First Guardian and Shield.
Source: AFR
Pooja Malik is a business journalist with over six years of experience covering startups, entrepreneurship, and emerging trends. She has previously worked with leading media platforms such as YourStory Media and BW BusinessWorld, where she reported on business, policy, and market developments. Currently, she serves as Editor at The Inspirepreneur Magazine, where she writes and edits stories across business, lifestyle, and travel, with a focus on clarity, accuracy, and reader relevance.
