Latest news with #financialcollapse
News.com.au
an hour ago
- Business
- News.com.au
Nurse loses almost $500k in savings after Australian Fiduciaries placed into liquidation
Experts have sounded the alarm after a Perth mum lost almost half a million dollars in life savings following the collapse of a superannuation fund. Western Australia nurse, Kathryn Shannon, had set up a self-managed super fund with Simple Super and transferred over $460,000 of hard-earned money over more than three decades. But its parent company, Australian Fiduciaries Limited (AFL), suddenly collapsed this year. The Australian Securities and Investments Commission sought asset preservation orders and appointed receivers to AFL through the Federal Court in June. Ms Shannon had made additional voluntary contributions throughout her working life to ensure she could comfortably retire, but she was left blindsided. 'I don't know how this could have happened. I never imagined I would face any difficulty with anything as simple as superannuation is supposed to be,' she said in an online post. 'I feel ripped off and the superannuation system is not safe. I am stressed about the uncertainty of my financial future. 'I now have doubt and fear about what my future will look like. Due to my age, the likelihood of earning enough to retire now is not possible.' Ms Shannon said she was left with many questions. She has flagged her case with the Australian Financial Complaints Authority, claiming she had been given inappropriate and incorrect information and advice. Financial adviser and founder of Pivot Wealth, Ben Nash, said while it is appealing to manage your own super fund, it can also be a trap. 'The biggest risk is that people don't fully understand what they're getting into,' he told 'You're not just choosing investments. You're running a regulated fund, with all the legal, tax, and compliance obligations that come with it. 'The risk isn't just poor investment returns. It's picking dud assets (like high-risk property schemes or private investments), failing to meet your compliance obligations, or putting your trust in the wrong hands – like in this case. 'If the trustee or platform fails, you wear the consequences. There's no government guarantee, and compensation is limited.' Fellow financial adviser and director of independent Wealth Advice, Andy Darroch, told it was similar to swimming at a beach. 'If you're in an SMSF, you might not just be swimming outside the flags, but you might be swimming on an unpatrolled beach, and crucially, you might not realise this,' he said. 'It doesn't mean you'll get into trouble, but if you do, you might not have the assistance you would have if you were between the flags on a patrolled beach, which I would say is an industry super fund.' MORE: 'Kiss your pension goodbye': Radical plan to remove Boomers Mr Nash stressed self-managed funds are not for everyone. 'SMSFs are often sold on the dream of control, flexibility, or lower fees – but the reality is more complex and far less forgiving. Unless you have at least $500,000 in super, a well-thought-out investment strategy, and a strong reason to DIY (like holding property or private investments through the fund), an SMSF is usually more admin and risk than it's worth,' the Pivot Wealth founder said. Mr Darroch agreed with his counterpart's remarks. 'You're taking higher risks, personal obligations, costs to your time and money and in exchange for this you get far worse investments than what you can get in a vastly superior, significantly cheaper and enormously less risky industry fund super fund,' he said. 'More risk, more cost, more time and a worse super fund, that's not a deal I'd recommend for anyone, regardless of balance or age.' Ms Shannon's post received dozens of comments which offered little sympathy. 'Unfortunately this is best example of someone wants SMSF without being aware of risks involved. Good faith is nice to have but doesn't help. Risk awareness is important,' one wrote. 'You do understand you made a choice to invest or put your super in them? I think it's terrible what's happened but doubt the government will bail (you) out,' another added. has reached out to Ms Shannon for comment. It is understood some 600 Australian investors have been impacted, with about $160 million put into investment schemes offered by AFL since February 2020. AFL stopped distributing units in the schemes in September 2023. On August 8, Terry van der Velde and Matthew Hudson from SV partners were appointed as liquidators to AFL and more than a dozen other entities. A hearing on the case is set for September 4 in Brisbane.
Daily Mail
3 hours ago
- Business
- Daily Mail
As Aussies face financial ruin over retirement funds collapse, money experts tell STEPHEN JOHNSON the warning signs you can't afford to miss
Australians have lost their homes, their retirement, and their peace of mind as a wave of self-managed superannuation funds collapsed without warning. Canberra couple Simon and Annette Luck face selling their house after losing almost every cent of their $340,000 nest egg. Perth nurse Kathryn Shannon saw her entire $460,000 life savings disappear overnight.
BBC News
6 days ago
- Business
- BBC News
Dundee University admits 'clear failings' over damning report
Dundee University has published its response to a damning report into the institution's financial collapse that led to a £22m government university said that the Gillies Report, which was published in June, had highlighted "clear failings in financial monitoring, management and governance".It has issued a 65-point action plan including daily cash flow monitoring, cancelling or deferring non-essential capital projects, and training in "financial literacy" for all members of the university's executive group, court and university also said that it had received 434 applications for its voluntary severance scheme. Dundee University said the independent report by Prof Pamela Gillies had been a "chastening experience and triggered a time for deep self-reflection". The university, which currently faces a £35m deficit, said that its "proposed route forward" would require "significant additional public funding".It received £22m from the Scottish Funding Council in February and will receive an additional £40m from the Scottish government over the next two academic university is looking to shed 300 roles through the voluntary scheme, after initially forecasting about 700 jobs would go. The Gillies Report savaged the university's former leadership team, including Prof Iain Gillespie, who resigned last found that Prof Gillespie, ex-interim principal Prof Shane O'Neill, and previous chief operating officer Jim McGeorge had acted as a "triumvirate", making decisions among also questioned the quality of information about the university's finances given to other senior report said university bosses and its governing body failed multiple times to identify the worsening crisis and continued to overspend instead of taking said the problems were "self-inflicted" and it should have been clear to senior members of the university that its financial position "was worse than presented". The university has now published its official response to the acknowledged there had been "a complete breakdown in cash management and expenditure control at the senior level of the organisation".It added: "While there were significant external factors, which had affected the higher education sector across the UK to varying degrees, the university's response to these, and responsible management of our finances, had fallen well short of the standards that everyone should have expected."However, it admitted that the situation was exacerbated by "over-reliance on the director of finance for strategic financial decisions, without sufficient independent challenge".It said members of the University Executive Group (UEG) were focused on their own portfolios, with "limited cross-functional financial accountability".The university said that the Gillies Report was clear on the "dominant nature of the most senior leadership in the university." It added: "This led to a hierarchical culture, characterised by hubris, the suppression of dissent, and fear of speaking out, resulting in an inability for staff to challenge constructively." 'Chastening experience' The university is proposing a series of actions that will be taken in the short, medium and long term, designed to ensure the university has a sustainable include daily cash flow monitoring and the implementation of further cost controls to reduce discretionary spending, such as principal Prof Gillespie was criticised last year for making costly trips abroad, including a £7,000 trip to Hong university said a new monthly management reporting process had been implemented to ensure that "management accounts are formally presented to senior management and the university court." There are also proposals to overhaul the court and to appoint a permanent principal with "experience of transformation and change and with a people-focused leadership style".It will also schedule a programme of monthly "town-hall" events to listen to the "concerns, hopes and ideas of staff and students."The response concluded by saying: "The circumstances surrounding the Gillies Report have been a chastening experience and triggered a time for deep self-reflection. "They present a unique opportunity to renew and refresh the university's covenant with its community—staff, students, alumni, the court, research partners, third party stakeholders, and the city of Dundee."
The Guardian
7 days ago
- Business
- The Guardian
Thames Water: advisers appointed to plan for utility's potential collapse
UK ministers have appointed insolvency advisers to make contingency plans for the potential collapse of Thames Water. The beleaguered water firm, which supplies 16 million customers, has been racing to pull together a deal to avoid financial collapse. In a development first reported by Sky News, Steve Reed, the environment secretary, has signed off the appointment of FTI Consulting to advise on contingency plans for Thames Water to be placed into a Special Administration Regime (SAR). The move indicates FTI is the frontrunner to act as administrator if the government enacted an SAR, although a court would ultimately approve such an appointment. The government has been trying to avoid such an outcome, with the Treasury threatening that a potential £4bn bill from the SAR could be forced on to Reed's department. This process would ensure the taps stayed on for customers, but would heap immediate costs on to the government. However, the government's Water (Special Measures) Act contains a provision for SAR costs to be recouped from customer bills further down the line. Thames faced embarrassment earlier this year when its preferred bidder KKR pulled out of a deal at the last minute. Now, its Class A creditors, which hold the bulk of the company's senior debt, are in talks with regulator Ofwat about a deal to inject capital into the company, which has £17.7bn of net debts and regulatory gearing of 84.4%. The company has been trying to get Ofwat to write off more than £1bn in expected fines from failures to invest in infrastructure to stop sewage spills, in order to secure a rescue deal. Its chief executive, Chris Weston, told a recent parliament committee that the company could not afford to pay these fines and continue to invest and operate as is expected by the regulator. A Thames Water spokesperson said: 'Our focus remains on a holistic and fundamental recapitalisation, delivering a market-led solution which includes targeting investment-grade credit ratings and returning the company to a stable financial foundation. 'Constructive discussions with our many stakeholders continue.' Andy Prendergast, national secretary of the GMB union, said: 'Thames Water has been sacrificed on the altar or privatisation. It's sinking without a trace under a deluge of debt, while huge amounts of cash from inflated customer bills have flooded out to directors, shareholders and loan servicing. 'If you want an advert for why private companies shouldn't be involved in certain sectors; this is it. Yet another damning indictment of Thatcher's terrible legacy. 'The government must now intervene to find a water-tight solution that protects Thames' millions of customers and gives immediate guarantees for the thousands of loyal workers and their pensions.' Sign up to Business Today Get set for the working day – we'll point you to all the business news and analysis you need every morning after newsletter promotion Thames Water faced fury recently over plans to pay senior staff members millions in bonuses from a controversial £3bn loan granted by the Class A creditors. The company has been banned from paying performance-related bonuses to its chief executive and chief financial officer over its poor performance. A government spokesperson said: 'The government will always act in the national interest on these issues. 'The company remains financially stable, but we have stepped up our preparations and stand ready for all eventualities, including applying for a Special Administration Regime if that were to become necessary.' FTI consulting has been contacted for comment.
Malay Mail
10-08-2025
- Business
- Malay Mail
After years of delays, Singapore's biggest corporate scandal trial starts tomorrow
SINGAPORE, Aug 10 — The trial of Hyflux founder and former chief executive Olivia Lum Ooi Lin, former chief financial officer Cho Wee Peng, and several former board members will finally start tomorrow, nearly three years after they were charged under the Securities and Futures Act. Seven individuals were accused of failing to disclose key information about the Tuaspring Integrated Water and Power Project, which later became central to Hyflux's financial collapse. Six defendants will contest the charges in a 56-day trial running until Feb 5, 2026, while one former independent director has already pleaded guilty, Singapore's The Straits Times reported. The case follows Hyflux's 2021 winding-up order, which left about 34,000 investors — including some from Malaysia — with total losses of around S$900 million in perpetual securities and preference shares. Prosecutors will proceed on 11 charges against the six defendants, including two of the six counts faced by Lum, while four other charges against her will be considered during sentencing if she is found guilty. The first charge alleges that Lum consented to Hyflux withholding information about Tuaspring when disclosure was required under Singapore Exchange rules to prevent a false market in its securities. Prosecutors say Lum failed to inform the exchange that Tuaspring was Hyflux's first step into the electricity market and that the plant's profitability depended heavily on electricity sales revenue. If convicted of this charge, the 64-year-old faces a maximum penalty of seven years in prison, a S$250,000 (RM824,000) fine, or both. The second charge accuses her of omitting the same information in Hyflux's April 13, 2011, offer statement for S$200 million worth of 6 per cent preference shares, an offence that carries up to two years' jail, a S$150,000 fine, or both. Cho, 56, who also served as Hyflux's group executive vice-president, faces charges of conniving in the omission of Tuaspring-related information. Four former independent directors – Teo Kiang Kok, 69; Christopher Murugasu, 66; Gay Chee Cheong, 69; and Lee Joo Hai, 69 – each face two charges of neglect and omission of material details about Tuaspring. Another independent director, Rajsekar Kuppuswami Mitta, pleaded guilty on Aug 7 to neglect in a 2011 announcement that named Hyflux as the 'preferred bidder' for Tuaspring without disclosing it was entering the electricity business, and was fined S$90,000 and barred from directorship for five years.
