ASIC continues Shield-linked enforcement with banning and AFSL cancellation

ASIC has cancelled the Australian Financial Services licence of MWL Financial Services and banned MWL’s director Nicholas Maikousis for 10 years over conduct in relation to the Shield Master Fund.

ASIC found MWL operated what it called a “low cost advice project” from 2021 to receive referrals from telemarketers/lead generators and to recommend clients invest their superannuation in Shield. Between September 2021 and February 2024, MWL recommended Shield to more than 750 clients who collectively invested $155 million.

“Clients who seek advice from financial advisers should be able to trust that the advice they receive will be in their best interest. Failing to manage conflicts has the potential to cause consumers to be given financial product advice that may not suit their needs,” said ASIC deputy chair Sarah Court.

As part of serious compliance failures, ASIC found MWL:

• Did not take reasonable steps to ensure its advisers provided advice that was appropriate and in the best interests of clients
• Provided template statements of advice (SOAs) to MWL advisers that contained misleading representations of Shield’s past performance
• Failed to properly assess Shield when it was added to MWL’s approved product list
• Was incentivised to recommend Shield
• Had undisclosed bonus arrangements with its financial advisers who recommended Shield
• Did not disclose its arrangements with lead generators in some SOAs nor in Financial Services Guides
• Failed to have adequate arrangements in place to manage conflicts of interest
• Failed to advise clients of their rights to complain to AFCA.

ASIC has also banned MWL’s managing director Nicholas Maikousis for 10 years from providing financial services. Effective from 25 September 2025, Maikousis is also banned from controlling an entity that carries on a financial services business or performing any function involved in the carrying on of a financial services business.

According to the regulator, Maikousis was not only responsible for the establishment of the “low cost advice project” but also the “driving force behind it; that he was on the investment committee that approved Shield and that he did not have an adequate appreciation for a financial services business’ fundamental obligations to its clients”.

Compliance manager ban

ASIC has also banned the firm’s responsible manager and compliance manager Robert John Tohill from providing any financial services for five years. The ban also restricts Tohill from “performing, as an officer, responsible manager or compliance manager, any function involved in the carrying on of a financial services business and controlling an entity that carries on a financial services business”.

According to the regulator, Tohill was:

• Involved in contraventions of financial services laws by another person.
• Was on the investment committee that continued to evaluate and approve the Shield Master Fund.
• Reviewed and approved template statements of advice (SOA) and certain SOAs prepared by financial advisers which contained:
  False and misleading information about the performance history of Shield.
  No information about MWL’s arrangements with lead generators.
• Was responsible for the content of financial services guides that did not disclose required information about MWL’s arrangements with lead generators.
• Was responsible for maintaining MWL’s compliance manual which included MWL’s conflicts policy.
• Failed in his gatekeeper functions as compliance manager and responsible manager.

“Mr Tohill commenced as compliance manager at MWL in December 2016 and was appointed as one of MWL’s responsible managers in December 2021,” ASIC said in a statement. “Whilst at MWL, certain financial advisers provided personal financial product advice to consumers who invested in the Shield Master Fund.”

In cancelling MWL’s licence, ASIC required MWL to remain a member of AFCA until 25 August 2026.

MWL, Maikousis and Tohill have the right to apply to the Administrative Review Tribunal for a review of ASIC’s decisions.

The action follows ASIC banning four MWL Financial Services advisers in July, beginning with Isaac Jacob McQueen and Matthew Simon Bradley for a period of four and eight years, respectively.

Later that month, ASIC announced it had banned MWL advisers Rocco D’Amelio and Robert Crossing from providing financial services for a period of seven and six years, respectively.

At the start of July, ASIC deputy chair Sarah Court had signalled bans were on the horizon, warning consumers to be on “red alert” over the kind of high-pressure sales tactics that urge super switching, which has been a key feature of its investigations into both Shield and the First Guardian Master Fund.

ASIC’s investigations into Shield have found that at least 5,800 consumers invested funds totalling more than $480 million, primarily through superannuation platforms, the trustees for which were Macquarie Investment Management Limited and Equity Trustees Superannuation Limited.

Earlier this week, ASIC announced it had commenced civil penalty proceedings in the Federal Court against Equity Trustees Superannuation Limited, alleging it failed in its due diligence requirements over the inclusion of the Shield Master Fund on its platform.

Equity Trustees’ parent company, EQT Holdings Limited, quickly responded in an ASX announcement, saying it is “considering ASIC’s claim carefully and will respond on the substance of the claim in due course”.