ASIC asked to monitor Sect 56 communication by QSuper
The regulator has been asked by Parliament to monitor the communication by QSuper in informing members of Sunsuper, which is set to merge with QSuper, they could be liable for an extra fee to cover fines and penalties.
QSuper won a case in the Supreme Court of Queensland to charge members an extra fee that would be used by the super fund to cover any fines or penalties, a clause known as Section 56.
A merger between QSuper and Sunsuper was due to be completed in February 2022.
Speaking in the House of Representatives, the Australian Securities and Investments Commission (ASIC) was asked whether it would be monitoring how this was communicated to members.
Bert van Mannen, Liberal MP for Forde, asked ASIC: “What should QSuper advise members that they are now liable for any fees and penalties the directors might incur as a result of their activities? Of even greater importance, QSuper is merging with Sunsuper and so this will also apply to Sunsuper members and they may be unaware of this”.
ASIC chair, Joe Longo, said: “That is a matter for trustees to communicate with their members in a way that is not misleading or deceptive. The issue of who pays these penalties is getting a lot of publicity and exposure so we will be monitoring what the industry says on the subject.
“We are always monitoring communication with members to ensure that they are not misled or deceived about things.”
The issue of who paid penalties had been a controversial topic in the superannuation space. In November, Senator Jane Hume, minister for superannuation, financial services and the digital economy, described it as a “retrograde step” for funds to charge this at a time when the Government was trying to reduce super fees.
Van Manen then asked whether ASIC would be writing to QSuper about the advice it would be providing to members.
ASIC commissioner, Danielle Press, added: “We will be speaking to QSuper and Sunsuper to ensure the trustees have taken that into consideration when ensuing the merger is in best interest of both funds. I suspect APRA [the Australian Prudential Regulation Authority] will also be watching it closely”.
AUTHOR
Laura Dew
Recommended for you
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.
Former chair of the House of Representatives’ Standing Economics Committee, Tim Wilson, is planning a return to politics after losing his seat in the 2022 federal election.
Morningstar is going to offer research ratings of funds in the $3.5 trillion superannuation sector for the first time in response to demand from financial advisers.
Treasurer Jim Chalmers has opened a consultation into the design of the annual superannuation performance test, canvassing views on a range of reform options.
