Super funds are obliged to ensure members are only charged for financial advice they actually receive but not all are doing so.
Already a subscriber?Six years on from the Hayne royal commission, the Australian Securities and Investments Commission has found evidence that fee for no service charges remain a feature of the superannuation industry.
“Despite repeated calls for an uplift in practices from ASIC and APRA in joint letters issued in 2019 and 2021, our latest review shows continued deficiencies in trustee oversight of advice fee deductions by some trustees,” ASIC commissioner Simone Constant said.that members can be charged. However, ASIC found fee caps as high as $20,000 or 5 per cent of a member’s balance and few of the funds investigated had put in controls to protect members with low balances.
“Superannuation trustees should have processes in place to detect and respond to suspicious activity.” The investigation was tasked with examining whether super trustees have improved their monitoring of advice fee deductions following 2018’s Royal Commission into Misconduct in the Banking, Superannuation, and Financial Services Industry.
ART does advice fee checks on both a risk and randomised basis and during the period of time covered by the ASIC report, ART had to “work with advisers to explain to them what trustee obligations are” on 38 occasions, Ms Fuchs said, In some of those instances, advice fees charged to its members were either reduced or repaid.
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