OnePath super facing fee for no service charges
The Australian Securities and Investments Commission (ASIC) has commenced civil penalty proceedings against OnePath Custodians on fee for no service charges.
The regulator has announced that it has commenced the proceedings alleging that OnePath charged fees for no service and made false and misleading representations to fund members.
ASIC is alleging that OnePath incorrectly charged over $4 million in fees to more than 18,000 fund members when it was not entitled to do so.
ASIC alleges that from 15 December 2015, OnePath charged financial advice service fees totalling $3,787,966.21 to 16,210 members who had been de-linked from their employer-sponsored superannuation plans. ASIC alleges that OnePath sent these members letters and annual statements until about May 2020 which failed to inform them of their rights regarding adviser service fees, including their right to terminate the fees.
ASIC further alleges that from December 2015 until about January 2019, OnePath incorrectly charged financial adviser service fees totalling $502,667.18 to 2,508 members who did not have a linked plan adviser. ASIC also alleges that OnePath sent annual statements to these members until about October 2019 representing it was entitled to deduct adviser service fees from their accounts and that they were obliged to pay.
ASIC claims that OnePath made false and misleading representations about its right to continue charging fees to these members, engaged in misleading or deceptive conduct and breached its obligations as a financial services licensee to provide services efficiently, honestly and fairly.
ASIC is seeking declarations, pecuniary penalties and other orders from the Federal Court.
In a statement issued to the Australian Securities Exchange Insignia Financial (formerly IOOF) noted the ASIC action and that the issues being pursued had occurred before Insignia took control of ANZ’s pensions and investments business.
It said that separate to any question of liability, OPC and ANZ were remediating any affected members.