Senior Managers / Governance in Australia

Key dates

2026-04-30

APRA issued its letter to banks, insurers and superannuation trustees calling for a step-change in governance, risk management, assurance and operational resilience for AI-related risks.

2026-05-08

ASIC issued its open letter to all licensees and market participants urging urgent strengthening of cyber resilience as frontier AI intensifies the global cyber-risk environment.

2026-06-01

ASIC and APRA began the June–July 2026 series of nine industry roundtables on frontier-AI preparedness and resilience; the source identifies June as the starting month but does not provide an exact day.

2026-07-31

ASIC and APRA completed the June–July 2026 roundtable period; the source does not provide an exact closing day.

2026-08-27

ASIC published the joint warning and related information paper and preparedness checklist, urging entities to move from awareness to action.

Suggested considerations

• Firms should consider presenting the ASIC and APRA roundtable themes, together with the available board and executive preparedness checklist, to the board and relevant risk or technology committees.
• Compliance teams may wish to map frontier-AI cyber and operational risks to existing obligations and controls under APRA CPS 230 Operational Risk Management, APRA CPS 234 Information Security, APRA CPS 220 Risk Management where applicable, and the entity's ASIC licence, governance and cyber-resilience arrangements.
• Firms should consider identifying critical assets, systems, data flows and material third-party dependencies, including common providers and concentration points that could create sector-wide disruption.
• Technology and security teams may wish to test patching, identity and privileged-access controls, attack-surface reduction, backup integrity, recovery-time priorities and incident-response playbooks against AI-accelerated attack scenarios.
• Boards and executives should consider documenting risk appetite, incident escalation authority, recovery priorities, internal and external communication strategies and decision rights before a frontier-AI-related crisis occurs.
• Firms should consider testing response and recovery arrangements under compressed timeframes and retaining evidence of exercise results, lessons learned, remediation owners and completion status.
• Entities using or procuring AI should consider applying existing model, data, supplier, change-management and assurance controls to internally developed models, vendor tools and embedded AI functionality, including defensive-AI tools used for threat intelligence, vulnerability detection, code review or incident response.
• Procurement and outsourcing functions may wish to strengthen supplier assurance, obtain relevant information on providers' AI and cyber controls, map material dependencies and assess substitutability and exit arrangements.

What changed

The regulators have consolidated a cross-sector expectation that entities address frontier-AI risk through cyber fundamentals, critical-asset identification, timely patching, strong identity and access controls, attack-surface reduction, reliable backups, tested response and recovery arrangements, and third-party risk management.

Key dates

2021-09-01

ASIC's investigation into Edwards and associated entities commenced; the publication gives only September 2021 and does not specify a day.

2022-12-13

ASIC executed search warrants at Edwards's business premises and seized materials.

2025-01-22

The remaining court proceeding brought by Edwards that had delayed ASIC's review of seized materials was dismissed by consent.

2025-09-12

ASIC banned Edwards for 10 years under sections 920A and 920B of the Corporations Act 2001 from providing financial services, controlling an entity carrying on a financial services business, or performing functions involved in such a business.

2026-03-25

ASIC commenced NSW Supreme Court winding-up proceedings against the 12 companies and sought appointment of provisional liquidators.

2026-05-28

ASIC's disqualification of Edwards as a self-managed superannuation fund auditor took effect.

2026-08-19

ASIC's interlocutory application for appointment of provisional liquidators was heard before Justice Nixon.

2026-08-21

The NSW Supreme Court appointed Kathryn Evans and Vaughan Strawbridge of FTI Consulting as provisional liquidators of the 12 companies.

Suggested considerations

• Firms with exposure to the 12 companies should consider reviewing receivables, investments, security interests, guarantees, trust relationships and outstanding transactions, and preserving relevant records for engagement with the provisional liquidators.
• Investor-facing firms should consider identifying clients or funds exposed to the companies, suspending any further investor subscriptions or transfers involving the affected entities where legally and operationally appropriate, and assessing communications and complaint-handling requirements.
• Financial services licensees and professional firms that dealt with Edwards or the companies should consider checking the scope of their engagements, referral arrangements, client-money or custody controls, representations made to investors, and potential conflicts or undisclosed related-party transactions.
• Compliance teams may wish to verify that no person acting for the affected companies is relying on Edwards to provide financial services, control a financial services business or perform a function involved in carrying on such a business, given the 10-year prohibition under sections 920A and 920B of the Corporations Act 2001.
• Relevant firms should consider monitoring the NSW Supreme Court proceeding and the provisional liquidators' creditor and investor information portal ahead of the 2 November 2026 directions hearing.
• Persons holding potentially relevant information may wish to consider providing it to ASIC at Edwards.investigation@asic.gov.au and preserving documents relevant to the ongoing investigation.

What changed

The directors of the 12 companies no longer control their affairs to the extent provided by the Court's orders; the provisional liquidators are responsible for investigating and reporting on the companies' assets, liabilities, asset recoverability, solvency, likely creditor returns, suspected contraventions of the Corporations Act 2001 or ASIC Act 2001, and transactions requiring further investigation.

Key dates

2021-03-01

First Guardian Diversified Class and Growth Class became available to adviser-led members through Netwealth Super Accelerator Plus; the publication gives March 2021 rather than a specific day.

2022-12-01

First Guardian classes were closed to new investments; the publication gives December 2022 rather than a specific day.

2024-05-01

Falcon Capital froze redemptions, leaving approximately 1,080 NSMF members invested with holdings totalling about $100.7 million; the publication gives May 2024 rather than a specific day.

2025-12-17

APRA accepted a court-enforceable undertaking from Netwealth Superannuation Services addressing material weaknesses in its investment governance framework and practices.

2025-12-18

ASIC commenced Federal Court proceedings against Netwealth and accepted a court-enforceable undertaking requiring compensation of affected members.

2026-01-28

Netwealth credited compensation payments to affected members' superannuation accounts; ASIC reported that more than $100 million had been paid to over 1,000 investors in January 2026.

2026-08-20

The Federal Court made declarations that Netwealth contravened the Corporations Act in relation to First Guardian.

Suggested considerations

• Firms should consider mapping their investment-option onboarding and review processes against sections 912A(1)(a) and 912A(5A) of the Corporations Act 2001, including documenting how the trustee independently validates issuer-provided information.
• Compliance teams may wish to require documented evidence of independent enquiries into strategy, underlying assets, valuation methodology, leverage, related-party exposure, custody, redemption terms, liquidity and operational risks before an option is approved.
• Trustees should consider implementing risk-based ongoing monitoring, watch-list and escalation criteria for complex or high-risk options, with clear triggers for suspension, closure, member notification and review of future investment directions.
• Firms should consider testing whether product disclosure documents, investment menus, member communications and online materials accurately explain potential illiquidity and any limits or conditions affecting withdrawals or redemptions.
• Trustees may wish to review historical investment options that were onboarded between March 2021 and December 2022, or during comparable periods, to identify gaps in due diligence, monitoring, risk disclosure and remediation records.
• Compliance teams should consider preserving approval papers, committee minutes, independent research, issuer correspondence, risk assessments, liquidity analyses and member communications sufficient to demonstrate the basis for each onboarding and monitoring decision.
• Where material weaknesses are identified, firms should consider a documented remediation assessment covering member impact, compensation, disclosure correction, governance uplift and potential notification to ASIC, APRA or AFCA as appropriate.
• Trustees should consider whether their governance framework can evidence alignment with the best financial interests duty and applicable APRA prudential expectations, particularly when adding high-risk investments to a platform.

What changed

The publication records binding Federal Court declarations against Netwealth; it does not introduce a new statutory rule or generally applicable deadline. The relevant conduct was found to breach the Australian financial services licensee obligation in section 912A(1)(a) to do all things necessary to ensure licensed financial services are provided efficiently, honestly and fairly, together with section 912A(5A), in the context of Netwealth's operation of the Netwealth Superannuation Master Fund.

Key dates

2026-03-01

ASIC surveillance period began

2026-06-30

ASIC surveillance period ended

Suggested considerations

• Compliance teams may wish to review whether target market determinations are narrowly drafted and contain specific reasoning on how the product fits likely objectives, financial situations, and needs.
• Firms may wish to test whether onboarding questionnaires are genuinely tailored to client circumstances and whether repeated or unlimited retakes create a weak suitability gate.
• Firms may wish to assess whether disclosures clearly explain leverage, time decay, settlement, ownership rights, custody arrangements, transferability, and all material fees or costs.
• Compliance teams may wish to review sign-up incentives, fee-free trading claims, and reward promotions to confirm they do not obscure product risk or encourage impulsive trading.
• Firms may wish to verify that product governance and distribution controls continue after onboarding through monitoring, escalation, and remediation processes.
• Compliance teams may wish to consider whether retail distribution of short-dated ETOs and futures should be restricted or more tightly segmented given ASIC’s statement that these products are unlikely to suit many retail investors.

What changed

This is not a new binding rule; it is a supervisory publication that signals ASIC’s expectations for firms offering complex or high-risk products to retail investors. ASIC says entities should ensure target market determinations are sufficiently specific, onboarding questions are tailored to client circumstances, and disclosures clearly explain the risks, costs, ownership structures, and transfer implications associated with products such as fractional shares, ETOs, and futures.

Key dates

2020-10-20

McPherson’s issued earnings guidance to the market forecasting profit growth, supported by Dr LeWinn purchasing forecasts.

2020-11-12

Court found McPherson’s had sufficient information that sales and purchasing forecasts were materially below expectations and corrective disclosure was required.

2020-11-30

End of the period in which McPherson’s failed to correct the market.

2020-12-01

McPherson’s downgraded and withdrew its earnings guidance; the share price fell 34.5%.

2022-12-09

ASIC commenced civil penalty proceedings in the Federal Court against McPherson’s and Mr McAllister.

Suggested considerations

• Compliance teams may wish to review escalation processes for sales data, forecast changes, and other information that could undermine published earnings guidance.
• Firms may wish to test whether internal triggers require reassessment of market disclosures when trading updates, channel data, or event results materially diverge from prior assumptions.
• Directors and officers may wish to confirm who is responsible for approving market announcements and whether they have sufficient visibility over information that could make prior statements misleading.
• Listed entities may wish to reassess procedures for correcting or withdrawing guidance promptly after new information emerges, especially where prior statements were repeated in cleansing notices or AGM materials.

What changed

This is an enforcement outcome, not a new rule: the Court held that McPherson’s had a duty to correct the market once it learned, by 2020-11-12, that Dr LeWinn purchasing forecasts and sales results were significantly below expectations and that the October 2020 profit forecast no longer had a reasonable basis. The Court found the company breached continuous disclosure obligations and misled investors by failing to disclose the revised forecasts and by not withdrawing the October 2020 profit forecast between 2020-11-12 and 2020-11-30.