Telstra Super hit with ASIC action over complaints

One of Australia’s largest corporate superannuation funds, Telstra Super, has been hit with Australian Securities and Investments Commission court action alleging it has failed to meeting its internal dispute resolution requirements in 40% of cases.

ASIC said it had filed civil penalty proceedings in the Federal Court against Telstra Super in what represents the first case to be brought under changes to the regulatory setting which commenced on 5 October, 2021, requiring super funds to respond to complaints within 45 days.

ASIC alleges that 40% of Telstra Super’s responses to complainants during the relevant period did not comply with its own dispute resolution procedures, which included 106 complainants who were not responded to within the applicable 45-day timeframe.

ASIC said it alleges that between 22 October 2021 and 13 January 2023, Telstra Super received 337 superannuation complaints but failed to comply with notification requirements when it failed to:

• respond to 106 complainants within 45 days;
• inform 85 complainants about why there was a delay in responding to their complaint; and
• inform 22 complainants about their right to take their compliant to AFCA.

Commenting on the situation, ASIC Deputy Chair Sarah Court said, “ASIC expects the financial services industry to have effective dispute resolution procedures in place, and, importantly, to have the systems and resourcing to ensure they are being put into practice. Financial service providers need to prioritise dispute resolution procedures to properly protect consumers.”

ASIC further alleges that Telstra Super failed to operate efficiently, honestly and fairly when it failed to comply with its procedures, sent delay notifications to complainants when it was not justified to do so, and did not have adequate resources to comply with its internal dispute resolution procedures.