Industry funds representative body the Australian Institute of Superannuation Trustees (AIST) has urged the Australian Financial Complaints Authority (AFCA) to identify the firms about which it makes determinations while supressing the names of those making the complaints.
At the same time, the AIST has called for the naming of service providers such as insurance companies if they are responsible for or have contributed to the raising of a complaint.
The AIST has used a submission responding to AFCA’s consultations around rule changes to state that “consumers need to know which financial organisations have been complained about”.
Further it said that consumers needed to know which complaints ended up needing to be determined, what the complaints were about and whether they were upheld in favour of the complainant.
“This information should be published on AFCA’s website in a snapshot format for each member financial firm,” the submission said.
“AIST supports the proposal in the Consultation Paper that the name of the financial firm (s) would be published in AFCA determinations going forward. As we have previously stated, it is important that consumers are aware which financial organisations have been complained about,” it said. “We also support the non-publication of the names of other parties. It is particularly important that the name of the complainant is not published.”
“AIST appreciates that the AFCA Rules confine ‘financial firms’ to those which are AFCA members. Accordingly, the Consultation Paper - if implemented - would mean that individual people engaged within the financial firm would not be named. AIST supports this,” the submission said.
Comments
Couldn't suppressing the name of the complainant lead to a whole lot of bogus complaints, intended to discredit?
Perfect! Just make sure that each and every Industry fund is listed where they had provided "advice" to a investor on the appropriateness of their in house insurer and claim definitions that then resulted in a complaint after a failed claim.
So the AIST would also not have a problem with the full investigation of conflicts of interest within the Industry Super Funds when Directors of super funds also hold Director positions on entities of which the super fund they represent holds shares in that company also ?????????
Not only that, but AIST would not have issue with a major industry super fund holding shares in an entity of which the life partner of a Director of that super fund is also one of the main shareholders of that entity ???????
So an Industry Super Fund Senior Director's life partner, being a major shareholder of an organisation of which the Director's super fund holds shares in valued at over $140,000,000 as at 30/06/2018 is not a concern to the AIST ?????
Lets see if the AIST would like to make a statement on these types of issues.
this is bizarre.
AIST is a laughing stock of conflicted self-interested unionist zealots. Would be more pertinent for a thorough investigation how the AIST member funds utterly failed their sole duty obligations when they renegotiated for weaker policy conditions & higher premium insurance cover for members simply so that they could receive higher undisclosed commissions to the fund - which subsequently did not go back into member's profits but as remuneration for staff and union 'consultants'.
This and the ISA is infested with union involvement, which as their own Royal Commission in 2015 found them to be 'corrupt, perjurers and bullies with no regard to the law and an environment where thugs flourished'.
Get Unions and their greedy greasy hands out of our nations superannuation savings - they have no logical place being involved except for Keating's political manipulations back in the 80's
Paul Keating was the " architectural father " of superannuation....the creator of modern Australia as we know it and a forward thinking economic genius....just ask him !
The very close relationships between Directors of Industry Super Funds, associated entities and unions who benefit financially from the distribution of member's funds via the channeling of Directors Fees is a complex and conflicted pot of money, greed and political power all wrapped up in a blatant disregard for member's best interest, conflicted and vertically integrated advice models and a situation where members are charged a basic advice fee within the admin charges irrespective of whether they access or receive advice at all.
Would Paul Keating like to have a go at that one without once mentioning how good the world could have been had he had the opportunity to be Prime Minister earlier and stayed on for longer?
I have seen him talk for 45 mins a few years ago for the cost of approx $20,000 to the organisation.
It was the most self indulgent grandstanding I have ever seen and the money should have gone to charity.
You lot make me laugh. Most of you would not have a job if it wasn't for Paul Keating doing something big and sensible about superannuation for Australian retirees.
None of you seem to understand that industry funds also have employers representatives on the funds' boards. When you slag off the industry funds you are also slagging off their employer representatives. Try doing some research and you might be surprised just who are these employer representatives. Maybe the generally good results delivered by industry funds are due to the calibre of the employer representatives on industry fund boards.
Just like u make us laugh with your prejudiced view for industry funds hedware. we prob wouldnt mind if u at least logically debated the issues pointed out in other comments but like a big fat tortoise you hide back under your shell of blind attack. Keating wasn't a saint with altruistic ideals at heart; he saw an admittedly brilliant advantage for his political party, his political financial backers (unions), his political power brokers and of course his own very self interested political ambitions. To attempt to say he was 'doing good for the common Aussie' or that he wanted to improve superannuation with no other agenda is dumb dumb dumb.
Also u always seem very anxious whenever anyone suggest industry funds or their offspring like AIST should be investigated or made to be as accountable as every other financial organisation why is that?
You have to be aware that some lobby groups pay people to make comments to support their doctrines and to assist them to achieve their political and social outcomes. They have professional bloggers that don’t care about anything other than getting their employer’s desired outcomes.
Ok with your last paragraph. My first paragraph re your jobs is still stands.
My interest is retail funds. I want them to do better and not charge so much.
With the recent and current flight of capital from for-profit funds to industry funds shows that plenty of people have given up hope of the for-profit funds delivering better bottom lines for superannuants.
Maybe the Government should introduce a Future Fund superannuation fund to pick up the basic MySuper accounts. That way the Government would be rid of industry funds and would be rid of high fee charging for-profit funds that force people to take up the pension instead of self funded pension.
Hedware, retail funds are not so expensive any more. Many are cheaper than industry funds if you do your research (as advisers must).
The issue is a level playing field. Outperformance because you call property, venture capital and infrastructure defensive assets, and have a balanced portfolio that is actually anything but balanced, is just not right.
Recent reports showed that the MTAA was the worst performing fund amongst it's peers over 10 years. It's an 'Industry Fund', so no flight to quality there; but they are advertising a lot on TV again I see. Paying Craig Lowndes. Awesome use of members funds.
Hedware knows that there are many retail funds that are cheaper than industry funds. but he wont acknowledge that there are also Wholesale Funds and so forth in this same arena that are even cheaper. These are what we use the most ,however they are never compared. Quick comparison Hostplus balanced fund 1.39% versus a wholesale platform portfolio 1.09% .
I agree that there has been some reduction in the excessive fees charged by platform owners, product managers and fund managers, but not by that much once in total. Then there's wrap account fees.
By way of example, recently I went through the many products in the same asset class on offer by one product issuer and the difference in performance and volatility within this set of products was marginal. You could have picked any one with a dart and had the same chance in terms of returns and risk. But the fees were high despite the similarity of the offerings. Hardly any human expertise needed here which meant fees should have been minimal. Hardy the need to have different teams working on such similar products.
Agree re MTAA's dismal performance - once it was a top performing fund.
I hate the usual excuse that 'past performance is not an indicator of future performance'. What a cop out given what is paid in fees. This cop out is inexcusable in other industries. The Productively Council's recommendation to force poor performing funds out of existence is a good one.
Still at the bottom of all this is the need for individual businesses to be managed well to perform well.
There is an unhealthy obsession with the continuing push to drive fees down to a point where the profitability of the fund manager or the super fund will be compromised and the services and admin efficiency to members will suffer.
It is consistently pushed from media that you should always be looking at options that charge the least amount in fees, rather than look at the overall picture regarding the value delivered.
Value and cost are not the same thing but many people think they are.
For example, if an adviser charged $400 for an hours advice which resulted in a change in beneficiary nomination that reduced the potential death benefits tax to non dependents from $150,000 to zero for dependents would that be considered an excessive cost of advice per hour, or considered real value for the potential saving of $150,000 ??
John Ruskin stated...." The common law of business balance prohibits paying a little and getting a lot...it can't be done.
If you deal with the lowest bidder, it's best to add something for the risk you run".
Whilst it's fine to examine the fees on anything we invest in, it is not always the smartest move to choose the cheapest.
You may have overlooked that I left financial advisors out of list of high fee chargers. This was deliberate as I have often stated that financial advisors are worth paying for their advice and expertise (and that's why I think fee for service is best).
The payment of trailing commissions was/is just another way of jacking up the fees and charges without any real relationship to performance and therefore benefit to the ultimate client.
Wrap account fees can actually be the cheapest for people with large balances, particularly if you group a family together, as they are capped - unlike a lot of funds that provide no discounts for big balances, family or employer groups. There seems to be a lot of ignorance and misconception. Advisers can help, but they have been loaded up with so much unnecessary red tape that advice is now unfortunately unaffordable for many.
Some vertically integrated institutions seem to be able to get around the rules and move people from accumulation accounts to pension accounts over the phone, with no advice or product comparison; so in effect no consideration of a clients best interest. No consideration of estate planning issues etc. so long as the funds are retained in the platform all will be well. No Risk Profiling, investigation of their entire financial circumstances to ensure they are in the best position for tax, social security, etc. No Ongoing Service Agreements, no Fee Discosure Statements, no Opt In required.
There really needs to be a level playing field around advice. The best interest of the consumer is to have affordable access to advice without having to pay for unnecessary compliance. It’s not all about the fees, it’s a balance of what is best.
Agree with your comment about wrap account services. The high degree of computerisation by wrap managers makes a whole lot of things easier and more accurate.
Agree with your comment about the many things financial advisors do without people really knowing. The policies, the options, the regulatory bodies, the regulations, etc, etc are so complicated and ever changing these days that professional help is necessary for most people (particularly when there are major changes to superannuation, deeming, etc). In this respect I dont think financial advisors and their representative bodies have done a very good job of explaining the cost-benefit of people using a financial advisor. I explain to people, and it does take a while especially for young people to comprehend how a little advice goes a long way.
Some of the Productive Commission recommendations, I hope, ease the non-essential workload of financial advisors with licensing requirements, SOAs, etc and so enable advisors to targeted work for clients.
Would people actually choose to join a superannuation fund based on Craig Lowndes promoting it ?
Don't tell me.......if you were a Holden supporter you might, but if you were a Ford fan you wouldn't ?
If people are influenced by a race car driver in their choice of super fund, then what hope is there.
Same for footballers or celebrity promotion of any form of investment or retirement product.
If that sways your decision, then you are just plain dumb.
Totally agree. Trite marketing. Just devalues the role of financial advisors.
No, it’s just advertising. Paying an ‘actor’. Never anything to do with reality. As if Craig would be invested in the MTAA fund. The poor man would have to drive race cars until he is 70! It’s just a shame that so much ISA advertising has to discredit others and generalise instead of being truthful. Industry super have done some fantastic work, as have a lot of retail funds that are in some cases significantly cheaper with a much broader range of investment options, no monthly admin or exit fees. And better insurance definitions.
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