A teacher who dedicated over 40 years to building a retirement fund of approximately $500,000 has lost her savings after the First Guardian investment scheme collapsed just days before she was set to retire. Tess Ogara was anticipating a mortgage-free retirement in April 2025, marking her 65th birthday, when she received an email from liquidators FTI Consulting informing her that her funds were tied to Falcon Capital, which had gone into liquidation.
Ms. Ogara stated she was unaware her superannuation was invested in Falcon Capital until she made inquiries following the notification. She discovered that more than $500,000 of her superannuation was inaccessible. This situation affects approximately 6,000 investors involved in the $1.2 billion collapse of the First Guardian Master Fund and Shield Master in May 2024.
Officials later assessed Ms. Ogara's loss at $538,000. Her claim is now being processed by the Compensation Scheme of Last Resort (CSLR), which has a maximum payout of $150,000. Even with this payout, she anticipates being hundreds of thousands of dollars short of her lost savings.
The Australian Securities and Investments Commission (ASIC) has initiated regulatory and legal actions concerning the First Guardian Master Fund's collapse. ASIC chair Sarah Court noted that as of June, only 3,429 complaints had been lodged, suggesting many investors may still be unaware of their losses.
Ms. Ogara reported that she was sold the investment as a diversified product. However, she later learned that over 90 percent of her retirement savings had been directed into a single firm, Falcon Capital, through First Guardian. She expressed anger towards the financial advisor for structuring the investment in this manner without fully disclosing its high-risk nature.
The financial fallout has significantly altered Ms. Ogara's retirement plans. She had believed Australian retirement savings were effectively guaranteed by the federal government and never imagined losing her superannuation. The stress of the situation has caused her significant distress, leading to sleepless nights and persistent worry about how she accumulated such losses.
To manage her finances, Ms. Ogara has resorted to renting out a room in her home. She faces monthly interest payments of between $2,000 and $2,500 on a mortgage she had expected to pay off. She estimates having paid over $33,000 in interest since turning 65. Ms. Ogara believes she will need to continue working for at least another decade unless the government provides assistance for her losses and pursues recovery through legal channels.
ASIC is investigating the conduct of First Guardian Master Fund and its directors. Allegations include that director David Anderson siphoned millions into his personal bank account and moved $274 million offshore after learning of the investigation. Before the fund's collapse, Anderson reportedly purchased a $9 million mansion in Melbourne's Hawthorn. Another director, Simon Selimaj, allegedly bought a $548,000 Lamborghini Urus using funds from the scheme.
Liquidators have so far recovered approximately $1.6 million from the $1.2 billion collapse. Melinda Kee, an investor and leader of the advocacy group SOS Save Our Super, is campaigning for the retirement savings of around 12,000 Australians impacted by the First Guardian and Shield funds to be restored. Kee highlighted that many investors have postponed retirement, are struggling to support their families, and some have experienced severe mental health issues due to their losses.
Kee argues that Australian laws concerning superannuation have not kept pace with the scale of major financial collapses, stating that these are not isolated incidents but involve substantial sums, thousands of investors, and lengthy investigations. She is advocating for a shift in the conversation to address systemic failures and prevent future occurrences.
Ms. Ogara, who considered herself financially cautious and not a risk-taker, emphasized her belief that superannuation was safe and that her savings would be available upon retirement. She noted that most individuals are not financial experts and rely on their superannuation growing over decades to retire with dignity. Without intervention, she foresees a future of continued work until she is physically unable to, followed by reliance on the pension, leaving her beneficiaries with debt instead of financial security.