ASIC’s Macquarie 2023 Shield query was based on adviser flows
Financial advisers and the investment funds they were directing towards the Shield Master Trust were in the sights of the Australian Securities and Investments Commission (ASIC) when it queried Macquarie Investment Management in May, 2023.
The regulator has admitted it was the adviser fund flows rather than the Shield product itself that piqued its attention.
ASIC executive director for Enforcement and Compliance, Chris Savundra has denied to Senate Estimates that the regulator’s contact with Macquarie did not represent a “tip off”.
He said that at the point of the May 2023 contact, ASIC did not have concerns about Macquarie itself.
“…nor were we tipping off or giving Macquarie any information that we had any concerns in relation to Shield.
“What we were asking Macquarie to provide us was information on the funds invested in the Shield Master Fund through Macquarie’s platform and the names of the relevant advisers
“So, we were building a picture of where monies were coming in to the master platform that Macquarie had – so this was not a tip off,” Savundra said.
“Now it may well have alerted Macquarie to our interest and Macquarie may have acted on the back of receiving this notice but the suggestion that’s been made perhaps by other trustees that we were in a position to warn them, I don’t accept on the basis that we were, at that point in time, really just trying to understand the basic facts,” Savundra said.
Savundra was responding to questioning by NSW Liberal Senator, Dave Sharma who had referenced ASIC’s response to earlier questioning around its interaction with Macquarie and its decision to not similarly query other platform providers.
In that response ASIC said it did not send a s912C direction or any notices for production of documents to any other superannuation trustee at that time, “as we had no information to suggest the Shield Master Fund was available on other platforms at that time”.
“ASIC takes public action when we are able to do so. We were not in a position in May 2023 to issue a stop order on the Shield Master Fund (which would have stopped all platforms and advisers industry-wide from selling Shield). It was too early to make such an intervention.”
“The stop order came in February 2024, once we had enough information to do so. A stop order is a significant intervention and before doing this we need to obtain the necessary information and evidence to support this decision. We also needed to consider and understand the impact of the stop order on the Shield Master Fund and its investors, and satisfy ourselves that it was in the public interest to make such an order.”
“We were not in a position in May 2023 to issue a stop order on the Shield Master Fund (which would have stopped all platforms and advisers industry-wide from selling Shield). It was too early to make such an intervention.”
However, apparently ASIC had no problem in issuing a stop order on La Trobe FOR THREE DAYS, over issues around TMD wording. (Nothing wrong with the funds).
What am I missing ???
May 2023 preschool investigation queries:
– FUM total in Shield = $480 mill
– How many investors in Shield = 5,800
– How much FUM was in Shield from Macquarie Wrap = $321 mill
– How many investors in Shield on Macquarie Wrap = 3,000
Where did the rest of the FUM $159 Mill & 2,800 Investors come from then ????
The most basic of fact questions to ask and ASIC just hit the denial button.
ALWAYS freaking useless and accept zero blame for their failures.
This story from ASIC just doesn’t stake up. They received multiple warnings prior to their Macquarie inspection.
“as we had no information to suggest the Shield Master Fund was available on other platforms at that time”.
Maybe ask every platform (there aren’t that many) to provide a list of products every quarter perhaps. don’t even need AI to scan those lists to look for “shield”
This doesn’t shape up well…. C’mon.