Equity Trustees Faces ASIC Claim Over Shield Master Fund Due Diligence Failures
ASIC has initiated civil proceedings against Equity Trustee Superannuation Limited, alleging failures in due diligence and monitoring related to the Shield Master Fund. Equity Trustees is cooperating with ASIC and supporting affected members while reviewing the claims.
- ASIC files civil proceedings against Equity Trustee Superannuation Limited
- Allegations focus on due diligence and monitoring failures for Shield Master Fund
- Equity Trustees cooperating fully and reviewing the claim
- Support and recovery efforts underway for impacted members
- Potential regulatory and reputational implications for EQT Holdings
Regulatory Challenge Emerges for Equity Trustees
On 26 August 2025, Equity Trustees disclosed that the Australian Securities and Investments Commission (ASIC) has filed civil proceedings against its subsidiary, Equity Trustee Superannuation Limited (ETSL), in the Federal Court. The legal action centers on alleged shortcomings in ETSL’s due diligence, monitoring, and testing standards concerning the Shield Master Fund, a superannuation investment product.
ASIC’s claim asserts that ETSL did not meet the expected standards when introducing the Shield Master Fund to members or allowing increased exposure to it via superannuation platforms. This raises questions about the robustness of ETSL’s compliance frameworks and oversight mechanisms in managing investment risks for superannuation members.
Equity Trustees’ Response and Member Support
Equity Trustees has emphasized its full cooperation with ASIC’s investigation to date and is carefully reviewing the substance of the claim. Managing Director Mick O’Brien acknowledged the difficult circumstances faced by members affected by the Shield Master Fund issues and reiterated the company’s commitment to compliance and member interests.
In parallel with the legal proceedings, Equity Trustees is actively supporting impacted members by facilitating recovery efforts through the liquidation process and providing confidential counselling and wellbeing services. This dual approach aims to mitigate harm while the legal process unfolds.
Implications for the Superannuation Sector
The proceedings against ETSL highlight increasing regulatory scrutiny on superannuation trustees’ responsibilities, particularly around due diligence and risk management of investment products. Given Equity Trustees’ stature as a leading specialist trustee company with a long history dating back to 1888, this development may prompt broader sector reflection on governance and compliance standards.
While the financial impact remains unclear, the reputational risks and potential for heightened regulatory oversight could influence investor sentiment and operational practices within the superannuation industry. Market participants will be watching closely as Equity Trustees navigates this challenge and communicates further updates.
Bottom Line?
Equity Trustees faces a critical test of its compliance and governance as ASIC’s claim unfolds, with significant implications for members and the superannuation sector.
Questions in the middle?
- What specific breaches of due diligence and monitoring does ASIC allege against ETSL?
- How might this legal action affect Equity Trustees’ financial position and share price?
- What changes will Equity Trustees implement to prevent similar issues in the future?
