Super funds back ASIC over ACCC for scam regime
Major superannuation funds organisation, the Association of Superannuation Funds of Australia (ASFA) has backed the Australian Securities and Investments Commission (ASIC) as the appropriate regulator to oversee the Scams Prevention Framework in financial services.
While the legislation implementing the new SPF regime envisages the Australian Competition and Consumer Commission (ACCC) as the appropriate regulator, ASFA has told a Senate Committee it believes ASIC is more appropriate.
It said that consideration should be given to whether ASIC might be a more appropriate regulator for the superannuation sector than the ACCC if the scheme were to be extended to superannuation.
“Consideration should be given to whether ASIC may be a more appropriate SPF regulator for the superannuation sector than the ACCC under clause 58EB, if the scheme is extended to superannuation, given their extensive familiarity with our sector,” ASFA said. “This may avoid regulator duplication and the overextension of ACCC resourcing.”
“The ACCC is the default regulator under clause 58EB, but this can be changed by either the Commission themselves under 58EC or the Minister under clause 58ED. The possibility of ASIC being a more appropriate regulator for certain sectors is expressly contemplated by the legislation in clause 58FH,” ASFA said.
The ASFA submission makes clear that the organisation supports the SPF regime being extended to the superannuation sector and that it also supports an ongoing role for the Australian Financial Complaints Authority.
It said AFCA would be the most appropriate external dispute resolution (EDR) mechanism under the regime “as they are already familiar with the superannuation sector.
ASFA also suggested changes to the proposed penalty regime which proposes:
- $52,715,850 (i.e. 159,745 penalty units of $330).
- Three times the total value of the benefit derived from the contravention.
- 30 per cent of the adjusted turnover of the body corporate during the breach period.
“Given the significant and indeterminate nature of these civil penalty provisions, consideration should be given to whether a single maximum penalty should be provided for, with lesser penalties to be proportionately adjudicated via judicial discretion,” it said.
ASIC already has a responsibility to protect consumers from scams and they have abjectly failed to do so. ASIC has actually contributed to the rise in scams, through their vilification and persecution of innocent professional financial advisers. ASIC has “nudged” consumers away from professional advice and into the arms of scammers instead.
ASIC needs to have its powers reduced, and be thoroughly cleaned out. ASIC should not be given any more power or responsibility.