Super fund’s $440 million blown on manager’s Lamborghini, riverside mansion, pet projects

As much as $440 million of people’s superannuation has allegedly been torched by a rogue investment manager who blew the cash on pet projects, a $550,000 Lamborghini and mortgage repayments on a riverside mansion.

The parlous state of Falcon Capital’s finances were outlined by liquidators in a report this week that suggested there would be little to no return for the 6000 Australians who transferred their super from larger funds into Falcon’s investment product.

Falcon Capital founder David Anderson’s home in Hawthorn overlooking the Yarra River, Melbourne.Credit: Domain

Worse still for investors, the group’s liquidators have suggested that Falcon, which was led by Melbourne businessman David Anderson, had been pooling investors’ money in a process called “co-mingling”, faking returns and paying out existing investors by using the money raised from new investors – a system akin to a Ponzi scheme.

The damning liquidator’s report from FTI Consulting comes just a week after the corporate watchdog issued an unprecedented public warning about super switching schemes amid concerns more than $1 billion of superannuation savings have been wiped out in rogue super funds.

That total includes the losses from Falcon, which oversaw the First Guardian Master Fund, and the larger Shield Master Fund, overseen by Keystone Asset Management.

Both funds relied on the services of lead generators and high-pressure sales tactics to allegedly lure investors into the schemes, the Australian Securities and Investments Commission has alleged.

Falcon and Anderson are currently under investigation by ASIC and Anderson is subject to freezing orders and travel restrictions as the probe continues after the regulator took action against him and Falcon in the Federal Court.

ASIC is also investigating the lead generators, including Venture Egg boss Ferras Merhi and café owner Rashid Alshakshir, who allegedly each received millions in payments for delivering investors to the schemes – both of whom deny any wrongdoing. Merhi or Alshakshir were not directly named in the liquidators’ reports, but both have been referenced in court hearings and documents filed in ASIC’s application to have a liquidator appointed to the group.

The Federal Court has previously heard that Falcon had promised its investors their super would be invested in similar assets to large funds, such as shares in listed companies or legitimate property holdings.

Instead, liquidators and the regulator allege vast sums of investor money was used to fund Anderson’s pet projects – many of which have failed or have so little value that any returns for investors are minimal.

The liquidators said in their report that their allegations were based on a preliminary review of the business and their investigations would continue.

These personal projects included lending $12 million of investor money to high-profile Melbourne chef Scott Pickett to aid in the roll-out of his restaurant empire.

Melbourne-based chef Scott Pickett.Credit: Courtesy Scott Pickett Group

There is no suggestion Pickett was aware of the source of the cash or the concerns about whether Anderson was investing the money properly.

Anderson also allegedly used $25 million of investor money to bankroll the Fox Friday brewing business and Carwyn Cellars. Both of those businesses were purchased from administrators in recent weeks for sums that will not provide a return for the superannuation investors.

Liquidators have also found that Falcon Capital spent $548,000 to purchase and insure a 2023 Lamborghini Urus, which is now expected to sell second-hand for as much as $400,000.

Anderson is also suspected by liquidators of having used some of Falcon Capital’s money to make mortgage payments on his $9 million home in Hawthorn overlooking the Yarra River.

ASIC has previously alleged Anderson received $5.6 million in payments that could not be explained. It’s unclear from the liquidator’s report or ASIC’s documents whether Anderson used his salary to make the home payments.

Officers from the Australian Federal Police searched the home in February this year as part of their investigation into Falcon and Anderson. No charges have been laid.

According to Falcon’s books and records, another $40 million was allegedly used by Falcon to fund the purchase of property in Indonesia. Though liquidators have not been able to find any evidence those purchases were ever made.

Liquidators believe as much as $240 million of the superannuation savings raised from Falcon was likely “invested or sent” offshore, including to Indonesia.

Liquidators believe that Falcon kept making bad investments and supporting its executives even when the group was already insolvent in March 2024. They also allege the group made unfair payments to preference certain creditors and also engaged in other uncommercial transactions.

Falcon had initially resisted the liquidation of its business and instead sought to have its own administrators from McGrathNicol appointed to the company to help broker a sale of the business.

FTI said in its report: “Based on the Liquidators’ preliminary investigations, the Liquidators consider that the concerns raised by ASIC and grounds for the winding up were well-founded and that the actions taken were necessary in order to protect unitholders’ interests in the FGMF [First Guardian Master Fund].”

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