First Guardian-linked adviser allegedly received inflated loans from fund

ASIC has alleged Ferras Merhi obtained loans from First Guardian to purchase his advice firms with the funds far exceeding the purchase price as it presented evidence in its case against the adviser considered a central figure to the failed Shield and First Guardian master funds.

The regulator told the Federal Court on Thursday it has evidence of Merhi receiving money from both Shield and First Guardian for the purpose of marketing the funds and is also alleged to have owned “honeypot” websites and call centres that were used to respond to inquiries collected from those websites.

ASIC alleged that Merhi had obtained loans from First Guardian to purchase his self-licensed advice business Financial Services Group Australia and the amount of the loans received “far exceeded” the purchase price paid for the business.

Merhi was the lead defendant in the case, along with Venture Egg and FSGA, both of which he was the sole investor.

Venture Egg was licensed by InterPrac where Merhi was an authorised representative, while FSGA was a self-licensed firm he ran.

ASIC told the court that Merhi may have disputed the characterisation of some of the allegations, he hasn’t denied any of them.

The court was told the firms associated with Merhi started recommending clients switch their super into First Guardian or Shield, with 6000 clients receiving Statements of Advice from Venture Egg or FSGA within a period of just three years and ultimately moving $500 million into the products.

ASIC said Merhi received “significant benefits” including the volume of advice fees as well as payments from Shield and First Guardian.

The regulator recently expanded its proceedings against Merhi, alleging he engaged in unconscionable conduct, failed to act in the best interests of clients, gave conflicted advice, and provided defective Statements of Advice.

It has alleged he received nearly $18 million in upfront advice fees and more than $19 million from entities associated with First Guardian for marketing the fund to clients.

Merhi had assets frozen in February 2025 with an extension of the freeze granted later in the year but ASIC claimed in court he had regularly failed to disclose assets, including assets held overseas, until ASIC had discovered them and confronted him.

The court heard Merhi had been making unsubstantiated expenses claims to ASIC while under the asset freeze.

The case continues.

More advisers banned

Merhi hasn’t been officially banned by ASIC, but has been removed from the ASIC Financial Advisers Register, after his licensee InterPrac terminated its relationship with him in May.

On Thursday afternoon, ASIC announced it had banned former MWL Financial Services and United Global Capital adviser Jovan Videkanic for seven years for inappropriate advice related to the Global Capital Property Fund and Shield.

The banning order took effect from 25 August 2025. Videkanic was previously authorised by UGC from July 2020 to February 2022 and authorised by MWL from 7 February 2022.

ASIC alleged Videkanic gave advice not in clients’ best interests by establishing SMSFs to roll over client super and invest significant portions into the GCPF, while he was authorised by UGC.

The regulator acted on GCPF over concerns about the management of the fund and related parties involved in both the fund and UGC licensee, and banned director Joel Hewish for 10 years in July 2024.

When Videkanic was authorised by MWL, where he was also a member of the investment committee, he advised clients to roll over their super into Shield while giving clients SOAs that contained false and misleading statements misrepresenting the risk, performance and track record of the fund.

The regulator announced a banning of another MWL adviser, Wade Lance Spooner, on Tuesday, which followed the banning of two other MWL financial advisers in early July, and two others later that month, for similar reasons.