Equity Trustees Faces Rising Legal Risks Amid ASIC Compensation Claims
Equity Trustees faces an expanded Federal Court claim from ASIC seeking compensation for superannuation members after a $73 million revaluation hit the Shield Master Fund. The trustee disputes liability and supports liquidation efforts to recover member funds.
- ASIC amends claim to include compensation orders for Shield Master Fund losses
- Shield Master Fund revalued from $151 million to $78 million
- Equity Trustees subsidiary ETSL denies breach of fiduciary duties
- Liquidators anticipate material recovery for impacted members
- ETSL continues to assist liquidation and explore recovery avenues
Background to the ASIC Proceedings
Equity Trustees Limited (EQT), a stalwart in Australian trustee services since 1888, has found itself at the centre of an intensifying legal dispute. The Australian Securities and Investments Commission (ASIC) has expanded its Federal Court action against EQT’s wholly owned subsidiary, Equity Trustees Superannuation Limited (ETSL). Originally focused on civil penalties and legal costs, ASIC’s amended Statement of Claim now includes a direct call for compensation orders to members of the AMG Super and Super Simplifier platforms who suffered losses linked to the Shield Master Fund.
The Financial Impact and Fund Revaluation
Central to this dispute is the significant revaluation of the Shield Master Fund’s assets. As of 30 September 2025, the fund’s value was adjusted downward from $151 million to $78 million, a stark $73 million reduction. This adjustment is based on the midpoint valuation range provided by the court-appointed liquidators of Shield, signalling a material loss but also an expectation of some recovery through the liquidation process. This revaluation underscores the financial strain on members invested in the fund and frames the compensation claims ASIC is pursuing.
Equity Trustees’ Defense and Fiduciary Position
ETSL, represented by Managing Director Mick O’Brien, firmly rejects the notion that its actions caused member losses. The company insists it has fulfilled its fiduciary duties and complied with all relevant legislation, including the Corporations Act and the Superannuation Industry (Supervision) Act. ETSL’s stance is that any compensation liability should be directed at other parties involved in the Shield Master Fund’s management or operations. Meanwhile, the trustee continues to provide support services to affected members and actively assists the liquidators in recovering value.
Looking Ahead, Recovery and Legal Proceedings
The unfolding legal battle and liquidation process will be closely watched by investors and industry observers alike. The potential for material compensation payments introduces uncertainty around EQT’s financial exposure. However, the involvement of liquidators and the revaluation midpoint suggest there may be some recovery of funds for members, mitigating the overall impact. Equity Trustees’ commitment to transparency and ongoing market updates will be critical as the case progresses through the courts.
Bottom Line?
As ASIC’s compensation claims escalate, Equity Trustees faces a pivotal legal and financial test that could reshape its superannuation trustee role.
Questions in the middle?
- What is the potential financial exposure for Equity Trustees if compensation orders are granted?
- How much recovery can members realistically expect from the Shield Master Fund liquidation?
- Could other parties be held liable for member losses, and who might they be?
