Liquidators for First Guardian reveal less than 2 per cent of money owed to creditors recovered
The liquidator for the collapsed $500 million First Guardian managed investment fund has delivered an update to creditors who lost their retirement savings.
The liquidator for collapsed $500 million managed investment scheme First Guardian has revealed less than 1.6 per cent of the money owed to creditors has been recovered, upsetting a Canberra couple who lost $340,000 after trusting a bad financial adviser with their self-managed super.
FTI Consulting’s updated report to creditors has revealed that of the $512.8m owed to 6000 investors, just $8.02m or 1.56 per cent had been recovered from six investments.
Almost half that recovered money would be going to the liquidator in fees, with FTI Consulting revealing a liquidator’s remuneration of $3.2m.
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By continuing you agree to our Terms and Privacy Policy.Legal fees and disbursements were listed as another $3.3m, meaning creditors would be likely to receive very little unless more funds can be recovered from First Guardian investments that made been managed by Falcon Capital.
“The liquidators recognise how distressing this matter and process has been for creditors and unitholders, particularly in awaiting clarity about the prospects of recovering their investment,” it said
Simon Luck, 62, and his wife Annette, 58, lost $340,000 in combined retirement savings after trusting now liquidated financial adviser United Global Capital with their self-managed super in 2010, only to have it invested in First Guardian.
Mr Luck, a former Australian Border Force official who is now working part-time as a landscaper to pay the bills, is resigned to the fact liquidator fees could eat up the small amount that could be recovered.
“My concern is the amount they’ve recovered will barely cover the liquidator’s costs so they’ve actually spent more than they’ve recovered,” he told The Nightly on Friday.
The Lucks, who still have a $600,000 mortgage on their Canberra home and two adult children, have deferred their retirement and plans to visit bookkeeper Annette’s relatives in Holland.
They are also resigned to the fact the Federal Government’s Compensation Scheme of Last Resort would only potentially guarantee them a maximum payout of $150,000, given they had one self-managed super fund account that is now worth nothing because of poor auditing practices.
“I’m all for mandatory super, we should all be self-funded as much as possible, we shouldn’t be reliant on the Government but then to have no safeguards and regulation, it’s an absolute sh.t show,” Mr Luck said.
In the creditors’ report, FTI Consulting revealed another nine investments with a book value of $118.4m were considered to have “crystallised” with the liquidator noting “that no further recoveries are expected from them or they are considered to have nil recoverable value”.
A further four investments involving foreign entities, worth $344.5m, “remains very uncertain”.
The only hope was another $50.8m in five investments “which the liquidators currently consider should yield further recoveries” but “they are not expected to recover all of their remaining book value”.
The report by joint liquidators Ross Blakeley and Paul Harlond was delivered to creditors on Thursday night, 18 months after FTI Consulting were appointed as liquidators of the First Guardian Master Fund and its management group Falcon Capital.
A director, David Anderson, was found to have splurged $548,000 on a Lamborghini Urus SUV from the savings of retirement savers.
Superannuation trustee Diversa invested $300 million into First Guardian between 2020 and 2024, leading to the Australian Securities and Investments Commission commencing legal proceedings against it last year.
ASIC chair Sarah Court told a Senate economics committee hearing on Thursday that Diversa was still allowed to sign up new customers, under questioning from Liberal senator Dave Sharma.
“To be as helpful as I can, my understanding is Diversa is not precluded from taking on new members,” Ms Court said.
“I’m not sure that ASIC has the power to impact that.”
The Australian Prudential Regulation Authority has oversight over superannuation funds but ASIC has legal carriage to commence civil proceedings.
The Lucks have turned to advocacy group Save Our Super that helps other victims of financial misconduct.
