ASIC takes AustralianSuper to court over 90,000 duplicate accounts
The Australian Securities and Investments Commission (ASIC) has initiated legal action against AustralianSuper over the big industry fund’s alleged failure to deal with multiple member superannuation accounts.
The regulator announced this morning it has commenced civil penalty proceedings against, AustralianSuper, alleging failures to address multiple member accounts.
ASIC alleges that for almost ten years, AustralianSuper failed to have adequate policies and procedures to identify members who held multiple AustralianSuper accounts and to merge those accounts, where merger was in the member’s best interests.
It alleges that AustralianSuper then continued to charge multiple sets of fees and insurance premiums to these members.
Commenting on the action, ASIC Deputy Chair Sarah Court said, “Failing to merge duplicate accounts within a fund can have significant financial consequences for members who end up paying multiple sets of fees, eroding their superannuation balance over time.”
ASIC alleges that between 1 July 2013 and 31 March 2023, approximately 90,000 AustralianSuper members were affected, with total cost to members of approximately $69 million.
“ASIC is concerned that despite AustralianSuper allegedly being aware in 2018 of the number of multiple member accounts within the fund and possible gaps in its policies and procedures, it did not take adequate steps to investigate and resolve the issue until late 2021 and early 2022,” the statement said.
“ASIC expects that superannuation funds will put their members first and promptly address issues that cause members to face multiple sets of fees and insurance premiums. We expect these issues to be identified and rectified quickly, including compensating members if a trustee has failed to comply with its obligations,” Court said.
ASIC claims that, between 2019 and 2023, AustralianSuper failed to:
- set out a procedure to identify and merge multiple accounts of members in accordance with section 108A of the Superannuation Industry Act,
- efficiently identify, escalate and rectify the ongoing failure to comply with that section and remediate affected members,
- promptly identify and merge multiple accounts in accordance with the required procedures,
- do all things necessary to ensure its financial services were provided efficiently, honestly and fairly,
- exercise the same degree of care, skill and diligence as a prudent superannuation trustee would have exercised, and
- perform its duties and exercise its powers as a superannuation trustee in the best interests of its members.
- ASIC is seeking declarations, pecuniary penalties and other orders against AustralianSuper.
The date for the first case management hearing is yet to be scheduled.
Advisers paying for this court case too hey ASIC ?
About bloody time.
We look forward to ASIC and APRA releasing a joint apology to Australian Super for inconveniencing them by making them abide by the same rules as everyone else. They will fine them a nominal amount that will be paid by their members, absorbed into consolidated revenue, with the cost of the case being covered by financial planners. ASIC, APRA and the union fund staff will all have a lovely time at the union fund super box at the AFL and NRL finals were they will have a laugh at the whole situation.
Until we see meaningful action and reform taken around all the previously identified issues with the school of Bernie Madoff false return ponzi schemes called industry funds, Australia is heading for its own fiscal cliff and absolute regulatory capture by these socialist-aligned super funds.
Not Surprising! This double dipping on members accounts is probably the tip of the iceberg. If advisers took funds from just one member they would lose their licence and livelihood. Australian Super trustees have effectively stolen from 90,000 Australians without remorse.
These are the same trustees our national treasurer wants to entrust and give an open licence to. He wants to allow this group to provide in conflicted Retirement Advice!
However the problem is they have a pure conflict of interest as a product provider who are meant to give impartial advice to members and recommend outside their own product. Do you think Australian Super would ever recommend HESTA, CBUS, CFS, HUB24, Hostplus, Self Managed Funds or any other fund/platform outside of their own? Of course they won’t. Will they be proficient in offering unbiased and comprehensive Estate Planning, Accounting, tax, lending, property, aged care, family Intergenerational , debt, insurance, property, non-super investment, advice?
Or are these product trustees going to be focused on retaining their member base. I’ll let you be the judge given that double dipping on their members account’s doesn’t bother these trustees.
Wake up treasurer!
I would like to know which of their trustees were held accountable for this theft from 90,000 members by ASIC?
Which directors of this company are serving time like they made the individual from Van Eyk serve time, and lose his licence for his breaches?
Now tell me that these funds aren’t a protected species under the Labour Party?
Is this the same Australian Super that ASIC controversially nominated as their default fund for their employees? The same fund that for years sold a ‘balanced’ investment option which contained less than 10% cash and fixed interest?
How can ASIC prosecute fairly when they have a huge conflict of interest, being that Aus Super is their nominated employer fund?
Why doesn’t ASIC ask why these industry funds mandate that a minimum account balance of $6k needs to be mainted. The answer is, so that the funds can maintain memberships, and subsequent fees. Its peoples own money, not the super funds.
I was just at Coles and I saw ASIC there puchasing a wet piece of lettuce, now I know why they were doing this!