Proceedings are underway after ASIC sued the super fund last year, then StatePlus Super, for charging more than 36,000 members fees for no service.
Appearing at a House economics committee on Thursday, Aware chief executive Deanne Stewart was asked by committee member Tim Wilson if the fund would consider increasing member funds to pay for any potential fine ahead of reforms to section 56 of the SIS Act next January that allows the provision of paying penalties with member savings.
While she refused to speculate given the proceedings are ongoing, Ms Stewart did say Aware is seeking legal advice on the matter.
“We are in the middle of those proceedings, so I would not want to preempt that or prejudice those court proceedings,” she said.
We’re certainly considering those options at the moment and seeking advice on that.
“We will certainly have something in place at that time.”
Ms Stewart’s comments come only months after APRA was questioned about the legality of an industry super fund allegedly using member funds to pay off remediation costs, who said at the time, “APRA said the case concerned the ‘payment of remediation to members by StatePlus rather than payment of a fine imposed by a regulator’”.
When you are a mammoth Industry Fund, you can pretty much do what you like, as the regulator is virtually a lapdog in their presence. But if you are a financial adviser, you cannot be trusted, no matter what. Talk about a parallel universe.
you’ve clearly never worked for a ‘mammoth’ industry fund
The usual avoiding the issue by regulators when it comes to industry funds.
Nothing done about members being refused access to their funds to pay advisers of their choice.
Nothing done about AustralianSuper passing over members details to outside organizations.
Nothing done about industry funds delaying rollovers by refusing to accept the forms submitted.
We have silence from politicians, regulators, consumer groups and our own industry bodies.
So what’s the difference between the Dixon Advisory Case and this….They’ll issue some corporate debt built into their own in house product and get their advisers to sell those products and then write it off….worked well before..
One clear difference is that Dixon Advisory breached the Corporations Act, and admitted it. That’s is, they admitted they actually broke the law. They are proven a criminal organisation. That’s a pretty big difference right there.
Seriously though, what options does an industry fund have to pay for any sort of remediation or fine or whatever? Surely the only option is to come from the reserve?
Well spotted !
There are no options, this is a fundamental issue with the “not-for-profit” model.
There seem to be hints that APRA are on to this issue, however won’t be holding my breath.
is it though? I’d rather be a member of Aware Super than a shareholder of AMP.
Maybe the unions could forgo some of the millions of dollars they strip out of members accounts each year, via payments hidden as costs.
I guess theyd have to find it first?
Its not hard to spot. Excessive trustee fees and the trustee company has the same postal address as the parent union. One of my favourites was pointing out the insurer whom I’d never heard of, had the same address postal address as the union. They rip dollars for sure – but they do it through apparently legal means.
This is why the industry funds, ALP and Unions have fought tooth & nail against majority independent directors on the boards of the funds. They know it kills their golden goose because there’s no way an independent firm would choose these service providers or ‘in-house’ assets.
It’s a complete nonsense that the Royal Commission missed this. One needs only to read the annual fund reports and do some investigations.
ok, so to break this down:
1. Excessive fees – What would you want to be paid to be a trustee of a large super fund?
2. Which trustee shares an address with a parent union (does sound fishy)
3. So if there is independent directors on a board – that means the golden goose is killed? (Aware super’s chair is independent – i think)
4. Missed in the Royal Commission – I dont think ‘missed’ is right… i think its more accurate to suggest the retail funds and banks were just much more fertile ground. But, what funds are you accusing? (happy to read the financial reports, I just havent found anything yet)
Which means other than reputational damage the trustees are not penalised in anyway for poor behaviour.
trustees are subject to the FAR (like the BEAR) now… (i think)
it should come from the Directors and Trustees own pocket
didnt happen with the banks in the FSRC
Then who in their right mind would ever be a Director or Trustee?
great point… while trustees should be under scrutiny, thinking that they are all there for a gravy train is misguided.
They could pause directors emoluments until the fines are paid off.
Hahaha! Like this would ever happen…which I’m sure was your point!
just quit i guess?