Australian Securities and Investments Commission (ASIC) chiefs have fronted a parliamentary joint committee, singling out regulation of self-managed super funds (SMSFs) as one of their biggest challenges.
Responding to a question from committee member Paul Fletcher, federal Liberal MP for Bradfield, about the targeting of SMSF trustees for property investment, ASIC commissioner Peter Kell said the sector had a number of regulation issues that needed addressing and was a high priority for ASIC.
“[SMSF] is very much on our radar screen,” he said. “The sector is becoming very propular and effective, but we’re concerned about marketing activities and the promotion of direct property through SMSFs in particular,” the commissioner said.
“We are currently putting together a task force to look at these issues and to clarify our jurisdiction over SMSFs as it crosses a number of regulatory spheres.”
ASIC chairman Greg Medcraft said that while the SMSF sector needs to be supported, given the growing popularity with Australian investors, it remains a headache at this stage for the regulator.
“SMSFs ares one of our biggest challenges,” he said. “Education around them is quite poor and we are focusing heavily on correcting this," he said.
The chairman said ASIC was pursuing a number of cases in the courts against alleged criminal activity in targeting SMSF structures for investment in direct property.
“Where the money is, the fraudsters and conmen will follow,” said Senator Sue Boyce in response to ASIC’s announcement of criminal proceedings.
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