CANBERRA, Aug. 19 (Xinhua) -- The Australian government said on Wednesday that it will improve access to safe financial advice and strengthen consumer protections across the investment fund ecosystem following the collapse of two large retirement funds.
Minister for Financial Services and Assistant Treasurer, Daniel Mulino, said in a speech to the National Press Club that the government will introduce a package of reforms to protect Australians from conduct that can reduce financial security in retirement.
He said that lead generators will be banned from making unsolicited calls to Australians to sell retirement fund products and access to safe and secure financial advice will be improved.
The reforms follow the 2024 and 2025 collapses of two retirement funds, Shield and First Guardian, in which around 11,000 Australians lost a combined 1.1 billion Australian dollars (about 778 million U.S. dollars) in savings.
According to the Australian Securities and Investments Commission (ASIC), many people invested in the two funds after being contacted by lead generators and referred to financial advisers, who advised them to invest their existing retirement savings in Shield or First Guardian.
Mulino told the National Press Club that the collapse of the funds exposed vulnerabilities across the ecosystem.
"They involved sophisticated and often predatory lead generation practices, advice arrangements that may have failed the best interest duty, and managed investment schemes alleged to have involved mismanagement, conflicted conduct and, potentially, fraud," he said.
ASIC is investigating individuals and entities connected to Shield and First Guardian, including lead generators, financial advisers and auditors. ■
