APRA removes 13 directors after Trio collapse
APRA has released a report on its investigation into the Trio Capital collapse, which shows 13 individuals were removed from the industry and $71.7 million was compensated to investors.
In a statement, APRA said the 13 individuals removed were Trio directors between 2003 and 2009, and are now prohibited from holding senior roles in the superannuation industry for periods between three to 15 years, with one permanently banned.
In 2011 and 2012, the minister determined grants of financial assistance for those who lost money in the collapse, totalling $71.1 million.
"The grants included an allowance for costs associated with the grant applications and incidental costs of the acting trustee incurred as a consequence of the fraudulent conduct," the statement said.
APRA's investigation focused on six related-party investments totalling about $150 million, all of which was lost or unable to be recovered, the statement said. This includes losses associated with investments in Astarra Strategic Fund, which was a result fraudulent conduct.
Other losses can be attributed to a number of factors including inadequate investment governance processes, failure to adequately manage conflicts of interest from dealings with related parties; and failure to have adequate controls to mitigate fraud-related investment risk, the statement said.
"Since the Trio matter, there have been a number of important enhancements to the regulation of the superannuation industry which impact directly on these three critical areas," APRA said.
"These include introduction of prudential standards in superannuation, additional statutory duties imposed on trustees and directors, and further guidance provided by APRA on fraud risk management."
APRA added that there are further changes to regulation expected to be made.
"The government has introduced into Parliament legislative changes to further improve superannuation governance and improve transparency through portfolio-holding disclosure measures," the regulator said.
"APRA's review of the Trio failure has also identified other areas of potential legislative reform, such as enhanced requirements for significant changes in ownership or control of RSE licensees, and is liaising with the government on these changes."
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