Super a scammer’s ‘honeypot’

Mike Taylor

Managing Editor and Publisher

28 January 2025

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.