All eyes on Mulino for CSLR levy answer
As financial advisers wait to hear from the Assistant Treasurer and Minister for Financial Services, Daniel Mulino, how he intends apportioning the Compensation Scheme of Last Resort (CSLR) special levy, they also know a further $125 million can be added to the Shield and First Guardian bill.
The Australian Securities and Investments Commission (ASIC) has announced the filing of Federal Court charges against Diversa Trustees Limited which the company has vowed to defend.
The Statement of Claim filed by lawyers representing the ASIC against Diversa states that “the harm caused by Diversa’s breaches is about $125 million”.
Mulino will announce the Government’s approach to the special levy to address the over-run in the financial advice sub-sector levy cap with the most likely outcome being that, in line with the legislation, he spreads the funding across several sub-sectors because this represents the “most effective way of enabling claims to be paid in a timely manner”.
Importantly, in the context of Mulino’s upcoming CSLR announcement, the special levy does not take account of the losses owed to the collapse of First Guardian and Shield. Rather, the special levy will cover CSLR determinations relating to past events, including the collapse of Dixon Advisory.
The latest update to the Australian Financial Complaints Authority (AFCA) Datacube tells the story of what lies ahead for the CSLR listing the number of complaints lodged against companies, many of which have been integral to announcements around the collapse of Shield and First Guardian.
By way of example, Interprac Financial Planning is listed as generating 479 complaints, MWL Financial Services accounts for 113 complaints, Falcon Capital is listed as eliciting 52 complaints and Keystone Asset Management is listed as eliciting 16 complaints.
In announcing ASIC’s Federal Court action against Diversa on Tuesday, ASIC deputy chair, Sarah Court referenced the regulator’s “commitment to seek compensation for the victims of Shield and First Guardian wherever possible”
“Our first priority has been preserving assets for the benefit of investors to the extent they are available, and now we’re taking action to hold those we consider responsible to account with 11 cases underway in the Federal Court against 19 defendants,” Court said.
Diversa has acknowledged ASIC’s court action but is arguing that the First Guardian fund’s losses were the result of fraudulent conduct.
“Members of Praemium, AusPrac and YourChoice have suffered losses due to exposure to First Guardian and the associated fraudulent conduct. Considering the circumstances of the First Guardian fund’s losses, Diversa has determined that it is appropriate to seek financial assistance from the Federal Government under Part 23 of the Superannuation Industry (Supervision) Act 1993 (Cth). Diversa is currently in the process of preparing its Part 23 application and expects to submit the application before the end of the calendar year,” it said.
“Diversa considers that it is in the best financial interests of members to make these statutory applications and can confirm that any financial assistance provided will be applied for the benefit of affected members.”
Pay up Govt / ALP.
Scum bag Jones promised Govt to pay 1st year of Dixon’s / CSLR claims. The liar then changed it to 3 mth only.
Thus dumping $70 Mill onto CSLR for Advisers and others to pay.
Plus delays in AFCA / CSLR meant Scum Bag Jones & ALP Govt paid only 1 single Dixon claim.
Canberra / ASIC allowed Dixon’s MIS fiasco to happen over 10 years of 60 warnings.
Then back date Dixon’s CSLR status.
Then refuse to pay what they created.
CORRUPT CANBERRA, stuff you !!
Pay up Scum bag Jones.
As for the CSLR design to exempt MIS, thanks ALP / Jones, you are a criminal thief. Disgusting.
“Jones may view this as a clever solution since it doesn’t cost him personally, and let’s be honest—he has always supported industry funds. Unfortunately, this approach risks bankrupting small financial planning businesses and discouraging new entrants. His agenda does not appear to prioritize everyday Australians, and he is fully aware of that. Financial planners should not bear any responsibility for misconduct by individuals who exploit the system, yet they are being asked to contribute financially for issues they did not cause. Increasingly, government decisions seem self-serving, slow to respond, and driven by ego rather than genuine concern for the impact these laws have on families. It feels like a system where power wins over fairness. No wonder so many advisers have left the profession—ultimately, Australians may deplete their savings and end up on welfare, which is already under strain.”
I think there needs to be a Royal Commission into the links between legislators, unions and super trustees.
A deep dive. Let’s see the detail as to who is benefiting from these arrangements. (I.e. who has the cleaning contracts at the commercial office building owned by the fund etc.)
Just because the Givernment isn’t able to regulate competently, shouldn’t mean that honest advisers should fit the bill.
Its similar to a bank being robbed, the police were only able to catch 1 out of the 5 criminals. The judge decides that the rest of the town should share the sentence of the missing 4 criminals.
Why are we paying for the crimes of others??!!
How about the Politicians & Bureaucrats Compensation Scheme
Them to personally fund all their stuff ups.
Start with Dixons MIS fiasco $300 Mill
Then RoboDebt. $1 Bill
$12 Billion stuff up for SnowyHydro 2.