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.
[quote name=”Greg”]It’s an easy solution, and one which should have been instituted years ago when Henry Kaye got away.
Anyone who gets a fee or commission from financial dealings with clients, including real estate agents, PI Lawyers and property “wealth creation spruikers” should come under the same licencing requirements as Licenced planners and accountants with FOFA[/quote]
Spot on.
But it won’t happen because there are too many vested interests in ensuring regulation around real estate remains lax. Negative gearing advice anyone?
if cigarette packages can be compelled to have health warnings..so to can any advertising aimed at SMSF’s..”this product/service/education could injure your retirement savings..seek independent advice and consult the ASIC web-site
greg nailed it in his comment at #1
when are the regulators going to understand that commerciality and legals are not mutually exclusive in the real business world, and this needs to be communicated via the Cormann’s portfolio when he becomes the minister on 15/9/13
Unfortunately the ASIC forgets to tell people about the APRA regulated funds out there that have been caught by fraud. For example a number of these funds were invested in Trio Capital. The problem is not one of regulation. The regulation is already in place and the ASIC does not enforce it (accountants providing advice without a licence). I agree with Sen. Sue Boyce
Over regulation of SMSF will lead to people pulling out of the super system and thereby becoming a burden on future Governments.
Where is ASIC going to get the time, money and resources to set up a task force into SMSFs alongside the Accountants Licensing Regime, SMSF Auditor Registration and eventually the Financial Planner’s must become Tax Agents Regime….
What is also very concerning is that advice on borrowing to purchase property in a SMSF is non regulated. Warrants (limited recourse borrowing)in particular are not deemed as being a financial product?
It’s an easy solution, and one which should have been instituted years ago when Henry Kaye got away.
Anyone who gets a fee or commission from financial dealings with clients, including real estate agents, PI Lawyers and property “wealth creation spruikers” should come under the same licencing requirements as Licenced planners and accountants with FOFA