Continuing the damage control over its connection to the Shield and First Guardian collapses, InterPrac is using salaried advisers and support staff to assist Venture Egg and Reilly Financial clients.
Professional Planner revealed last week InterPrac was cutting ties with authorised representative firm Reilly Financial (controlled by Rhys Reilly) and had already ended its relationship with Venture Egg whose lead adviser, Ferras Merhi, has been off the Financial Advisers Register since the end of May.
“To assist clients during this period, InterPrac has established a dedicated team of salaried advisers and support staff to work with clients previously service by Venture Egg and Rhys Reilly,” the announcement said.
“This team is focused on providing appropriate guidance, information, and support as members navigate this process.”
Additionally, InterPrac is finalising a “client information support package” which will be distributed in the coming fortnight.
“This package will outline the steps we are taking collaboration with relevant authorities, superannuation funds, government bodies to help identify and facilitate appropriate outcomes wherever possible,” the announcement said.
Sequoia has enlisted the help of former ASIC Commissioner Danielle Press to lead a dedicated governance committee for the group.
InterPrac is under investigation by the regulator, which has cancelled the licensees of smaller AFSLs MWL Financial Services, United Global Capital and Next Generation Advice. Additionally, Financial Services Group Australia’s – which was controlled by Merhi, who was also an authorised representative of InterPrac – has been cancelled.
Seqouia said the company recognises the collapses of Shield and First Guardian has caused “significant distress” for affected members but pointed the finger towards the platforms which hosted the products and which are also being investigated by ASIC.
“We remain confident in the strength of Australia’s superannuation system, particularly the large platform market which is designed to protect members’ interests and deliver fair outcomes which offers both choice and member protections,” the announcement said.
Sequoia also confirmed it has received a “number of complaints” to AFCA due to Shield and First Guardian totally approximately $22 million in superannuation investments. The current total estimated impact of both failed master funds is a combined $1 billion.
“This represents InterPrac’s potential exposure prior to any assessment of the merits of each complaint, and before consideration of any recoveries or offsets,” the announcement said.
This will be dependent on AFCA’s determinations on each case; any recoveries from the liquidators, auditors and trustees; and any professional indemnity insurance.
“AFCA has advised that the complaints remain at an early stage, that each complaint will be considered on its own facts and circumstances, and that no view has been formed on the merits of any complaint.”
