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ASIC Report Finds Gaps in Superannuation Platform Fee Caps and Advice Checks
Australia's financial regulator reviewed six large platform trustees holding $400 billion in retirement savings. The review identified shortfalls in fee caps, document sampling, and behavior monitoring. Commissioner Simone Constant discussed the findings in a public interview.
The Sydney Morning HeraldAudio version
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Australia's corporate regulator ASIC examined six major superannuation platform trustees responsible for $400 billion in member benefits. The review found shortfalls in three areas of trustee responsibility: fee oversight, advice-document sampling, and monitoring of unusual activity.
Two years earlier ASIC had flagged adviser fee caps reaching $20,000 as excessive. In the current review, one trustee reported a $25,000 cap and another planned a $30,000 limit. Commissioner Simone Constant said one adviser had charged fees that consumed half the balances of members holding about $10,000 each.
Trustees are required to sample advice documents each time fees are deducted. One trustee conducted 21 such checks over 15 months; 75 percent of those checks identified problems. Three trustees recorded at least one month with zero checks while continuing to deduct fees.
The regulator also found limited tracking of warning indicators such as rapid member inflows through a single adviser or unusual fee patterns. ASIC linked similar earlier gaps to losses exceeding $1.1 billion for 11,000 members in the Shield and First Guardian collapses.
Commissioner Constant stated that the same oversight duties apply to any superannuation fund deducting advice fees, not only platforms. ASIC has not named the six trustees reviewed.
