Super a scammer’s ‘honeypot’
Industry superannuation funds group, Super Consumers Australia (SCA) says the superannuation sector is a “honeypot” for scammers and is arguing that the superannuation industry should be next in line for an industry anti-scam code.
At the same time, SCA has detailed the common scams already being identified in superannuation.
Common scams include:
- Self-managed super fund (SMSF) scams, where a scammer facilitates a member to create a SMSF. The member’s super is then transferred into a bank account controlled by the scammer, or the member is convinced to transfer some or all of their SMSF balance to the scammer.
- Post-preservation investment scams, where a member past preservation age is convinced to withdraw some or all of their funds and transfer them to the scammer.
- Early access scams, where a scammer encourages a member to fraudulently access their super under extreme financial hardship or compassionate grounds, and then the scammer takes a cut, or steals the funds or the member’s identity.
“With $4.1 trillion dollars currently held in superannuation assets and an average member account balance of $164,000, the super system is a honeypot for scammers,” the SCA submission said.
“Once an effective SPF is in place across the banking sector, scammers will target other sectors such as superannuation. A clear commitment to the timeframe for designating the superannuation sector under the SPF is essential, as delay and uncertainty will hinder protection for consumers.”
“In line with the recommended timeline in the Consumer Action Law Centre submission we recommend:
- Superannuation included as a designated sector 8 months post Royal Assent of the SPF
- A superannuation industry code introduced 12 months post Royal Assent of the SPF
- The superannuation industry should have 8 weeks to comply with the code.
I suspect there are good intentions behind this one.
But somehow, something tells me that all these new security measures could just happen to slow up the legitimate process of moving FUM out of an industry super fund into a Retail fund.
And as a risk specialist I don’t have a dog in the fight.
The first two examples are well known scam targets, they also required a sense of gullibility from the Member to ‘act’ ….. sometimes you just can’t stop people who want a get rich quick scheme only to fund out it was a fraud. Super funds cant solve for all members dumb decisions.
The third example is not a scam on innocent consumers at all. It is consumers committing fraud, then losing more than their anticipated share of the proceeds to other criminals who coached them through the fraud.
Huge congrats to ASIC, Treasury & Govt who forced over 600,000 SMSF to be audited offshore in 3rd world audit farms.
Over a Trillion $$$$$$ of SMSF data, client details, SMSF details of everything about each SMSF, member and detailed every bit of investment information, bank accounts etc.
What is stopping the superannuation “sector” doing something now?
Let’s remember the same number of staff in the Financial Advice Section at ASIC is the same number of Officers in the Super team. Rather than ASIC chasing down scammers or regulating Super Funds they’re focused on chasing down down Advisers that met with a client on a Monday and the Anniversary date was on Tuesday.
There’s a bit to be said about this. You make a good point.