Responding to questions on notice from Liberal backbencher and House economics committee member Jason Falinski, ASIC said it would “consider appropriate regulatory action” if alerted to misleading conduct around the group’s modelling, but that this had been drawn from a financial calculator, which was exempt from the usual advice licensing obligations.
Mr Falinski asked the questions at a recent hearing of the committee when it emerged modelling from Industry Super financial calculators was being used in media campaigns to illustrate the projected impacts of the government freezing the SG rate, despite ASIC raising concerns about ISA’s modelling in April.
ASIC said that the modelling used in ISA’s April campaign around the early release of super had been different to that used in its generic calculator, and had been corrected to reflect this after the corporate regulator contacted the industry fund advocacy group.
“We had subsequent correspondence with ISA about this matter, including a further letter from ISA on 4 May 2020. ASIC was satisfied that ISA’s revisions to its calculator met ASIC’s expectations,” the regulator said.
ASIC said the modelling used in the recent SG media campaign by ISA had been consistent with that of its generic retirement calculator, and the corrected modelling from the early release campaign.
The regulator pointed to a legislative instrument which exempts providers from the usual advice licensing obligations if using modelling from generic retirement calculators.
“ASIC Instrument 2016/207 offers relief from the licensing, disclosure and conduct obligations that providers would usually need to comply with when providing financial product advice through generic financial calculators, including super calculators,” ASIC said.
“Relief is offered subject to several conditions, including that the assumptions used for the calculators are reasonable, and clearly disclosed.”
ASIC said that “a wide range of estimates may be considered reasonable and there are inherent uncertainties in any estimate”.
“To minimise the risk of misleading communications, we expect that providers will take a consistent approach to setting default assumptions in their generic superannuation calculators,” ASIC said.
“In these circumstances, ASIC does not have reason to believe that ISA has breached the law.”
The regulator noted it would be reviewing the relief provided around financial calculators and would release new guidance for consultation next year.
Whether it be ASIC, Treasury or any other government department or corporation, keep in mind that their workforce is the most unionised in the country. The public service has >30%union membership; for comparsion construction is only 10%.
ASIC are bad but AFCA are far worse. This ombudsman is not about fair, it is purely all about providing the community a free compensation scheme that drives up costs and places the entire insurance industry under threat. There is only 3 or 4 insurers left offering cover, and huge premiums and all are considering leaving the sector.
Its becoming very obvious ASIC should be disbanded & come under the direct control of The Treasurer. They are a total partisan joke & have been since they worked hand in glove with cementing the intrafund carve out racket into law.
I agree ASIC should go, but did you read some of the comments Treasury submitted to the RC – and I say comments but were presented as fact. Treasury has some real issues and some seriously agenda driven personalities.
This highlights the reason why the unions and their ALP puppets want to destroy financial advice. Licensed financial advisers are the only ones required to tell the truth and act in their client’s best interest. Union super can tell as many lies as they like via advertising, PR, and their unlicensed sales staff. This torrent of lies is the information they want consumers to use when making financial decisions. They don’t want consumers to have access to affordable, professional advice.
seems there is not enough competition. ISA v Government now. Wonder if ACCC will step in one day, and realise the exemption gravy train is increasing systemic apathy and obfuscation … (do members need to be aware of limited insurance quality, access to advice, limited transparency, valuation governance, limited choice etc ?), IFAs need to be supported now.
Yet again the REGULATORY CAPTURE CORRUPTION from ASIC to Industry Super.
Drain the ASIC swamp completely, the only way to get rid of the total corruption.
sooner or later.
ASIC will not pursue Industry Super at any level.
On several occasions, matters of concern have been raised and ASIC always have a reason not to pursue.
There is an inherent bias toward Industry Super by the regulator.
Can you imagine ASIC pursuing Australian Super if there were valid reasons to do so, when they have been appointed as the default employee super fund for ASIC employees ?? …it simply wouldn’t happen.
It is very quickly becoming clear the regulator has significant internal governance and cultural issues and is not accepted as being an independent and neutral regulator.
ASIC have become an influencer of legislation in order to attempt to skew it in the direction that will suit their agenda.