Jones condemns ‘unacceptable’ AustralianSuper breach
Minister for financial services, Stephen Jones, has reacted to the news of AustralianSuper’s refund for tens of thousands of members, saying he is “deeply disappointed” by the breach.
Earlier today (12 May), Australia’s largest superannuation fund announced that it would be refunding around 100,000 members as much as $100 million after a processing error failed to identify members with multiple super funds.
The fund said it not have to increase administration fees to pay for this remediation, with the cost of the remediation to be paid from the fund’s Operational Risk Financial Reserve.
The remediation aimed to return affected members to the financial position they would be in now if this hadn’t occurred, including refunding administration fees and any insurance costs deducted from impacted members’ secondary account, along with lost earnings on these amounts.
In an official statement, Jones said: “I am deeply disappointed by the news out of AustralianSuper today. This is an unacceptable breach of their obligations and full remediation must occur.
“Superannuation funds are trusted with the retirement savings of the nation. They must be held to a high standard to act in the best financial interests of their members.”
He also confirmed that the Australian Securities and Investments Commission (ASIC) was engaging with AustralianSuper, which self-reported the breach to the regulator.
“I will be monitoring this issue closely,” he concluded.
Profit-for-member fund AustralianSuper, led by Paul Schroder since October 2021, was the super fund for one in 10 working Australians.
AUTHOR
Laura Dew
Recommended for you
ASIC has called on superannuation funds to improve their oversight of advice fee deductions following an investigation of 10 trustees that found $990 million was charged in one year.
With just 30 per cent of Australians knowing their superannuation balance to the nearest $1,000, Findex has emphasised the role of financial advice in addressing the critical super knowledge gap.
Underestimating the cost of insurance by almost $75,000 in a Statement of Advice is among multiple reasons that a relevant provider has faced action from the FSCP.
Financial Services Council chief executive, Blake Briggs, is urging Minister for Financial Services, Stephen Jones, to take advantage of the QAR opportunity to reduce regulatory duplication and ensure advice is affordable.
He is not wrong.
Strange how a certain super fund owned newspaper didn't report this news at all.
So thankfully there's $100M built up in reserve for stuff-ups. No doubt at the expense of member returns over these past years... But who now pays to top the reserves in case of another one?
The fund said it would not have to increase fees to fund it because the operational risk reserve was funded by members, they STILL paid for it.
Wow, a union fund being obtuse with the truth, who would have thought??
It's a bit like the "all profits go to members" line. Profits... after advertising, marketing and sports sponsorship expenses that is...
Corporate boxes, union funded cars, gigs for retired shop stewards etc etc etc
and they want to allow these funds to hire backpackers and call them financial advisers to provide retirement advice.
Add new comment