Macquarie Investment Management commits full repayment to Shield investors amid ASIC action

Macquarie Investment Management has pledged to repay $321 million to thousands of Australians who invested hundreds of millions of dollars from their retirement savings in the collapsed Shield Master Fund.

The company acknowledged it breached the Corporations Act.

The Australian Securities and Investments Commission has launched proceedings in the Federal Court against Macquarie after the subsidiary admitted to the failings.

ASIC has also accepted a court-enforceable undertaking from Macquarie to ensure members are paid back their invested amounts in Shield in full, minus any withdrawals.

But ASIC said it would not seek a civil penalty for the breach, citing Macquarie’s “level of co-operation” and other factors.

Macquarie has also agreed to improve the investment governance on its wrap platform through a formal plan with the Australian Prudential Regulation Authority.

“This is an important outcome that stems the significant losses that threatened thousands of members’ retirement savings after they used Macquarie’s platform to invest their super in Shield,” ASIC deputy chair Sarah Court said.

“Many members thought their funds were safe when they used Macquarie’s super platform to invest in Shield, which had no track record.”

In a statement, Macquarie said its decision “to devote resources to achieve this outcome recognises Shield’s unique circumstances, notably the scale of the issue, its material impact on many investors and their limited access to recourse from the many different entities which played a role”.

“The approach of providing immediate certainty and an improved outcome for investors benefits all parties,” the bank added.