ASIC to go hard on super funds that overpromise

The Australian Securities and Investments Commission (ASIC) will be monitoring all communication from superannuation funds, not just those that failed the Your Future, Your Super (YFYS) performance test, with a focus on specific disclosures being made to members.

Speaking at the Australian Institute of Superannuation Trustees (AIST) Superannuation Investment Conference, Jane Eccleston, ASIC senior executive leader for superannuation, said the regulator would act if it saw false, misleading or deceptive conduct in these disclosures.

“We’ll be looking at the underperformance notifications that funds send to members, as well as other performance disclosure measures, including disclosures made by funds that passed the test,” Eccleston said.

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“For those of you working in investments, I would encourage you to think about the claims your funds are making about performance.”

Eccleston said investment professionals were often in the best situation to judge whether a claim was misleading or otherwise inappropriate.

“For instance, an investment professional within a super fund would know instantly that a 5% return over the past financial year is not something to crow about,” Eccleston said.

“But it might be less obvious to someone who is in marketing whose frame of reference is a term deposit.

“Claims about performance that confuse or mislead may give rise to legal consequences or reputation risk and don’t promote confidence in situation.”

Eccleston said the regulator wanted to highlight the importance of considering consequences for consumers in their day-to-day work.

“We want to see superannuation funds operate in a way that’s fair for members and promotes confidence in superannuation,” Eccleston said.

“This week there has been a lot of focus on the performance test and performance issues generally.”

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Will ASIC be taking action against super funds that advertise themselves as "Balanced" in spite of having 90%+ growth assets? Given that this deception is largely the preserve of union funds, I suspect not.

Probably not - appears ASIC is corrupt?

When the Govt / APRA own research Heatmap put Hostplus Balanced Fund at 94% Growth Assets.
What did ASIC do about it ????
Regulatory Capture Corruption at its worst, ASIC & Industry Super.
Disgustingly Corrupt ASIC.

This really needs to be looked it. It is ridiculous.

Hesta is a great super fund, they only charge $1.50 per week in fees.

I also like Hesta because they make 19% each year...oh in small writing it does say between 1st of January 2016 and February 2018...but 19% you can't beat that......I think there fund also only charges $1.50 a week too.

I also awarded AwareSuper Super fund of the year...(this week)......I have a private entity called Super Rater....they paid me of course $150,000 and I made $70,000 from the awards nights....but it was a "diligent" process based on a lot of variables, which requires substantial compensation and I can ensure you of my independence....I me...

You're leaving money on the table Yogi. Go back to them and say they can "licence" your Super Rater award logo in their advertising material. Another easy $100K or so. Then ask them for another $100K to cover the costs of an 'independent" press release extolling their virtues, that you will write and distribute to the media.

So an 85 year old 'Defensive' Client that has achieved a return of 5% over the past financial year is 'nothing to Crow about'. So they are saying forget about individual risk profiles and client circumstances... in their eyes we should just pile everyone into the 1 MySuper option and forget about it.

Yep but I think they'd actually prefer you to be more specific and select the AustralianSuper Balanced Option. After all that's the default option at ASIC....they're are two types at ASIC. An ASIC staffer aged 32...who has no idea of the value of advice and only deals with crooks.... or if they're older and have half a clue... they had their money in AMP Signature Super being charged 5% entry fees earning 2.5% over 20 years...and hate you....and are disgruntled at there own personal morals, that they didn't take up that job offer at CBA Compliance when it was offered after an audit. In short we're all stuffed.

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