The Federal Court has dismissed ASIC’s case against superannuation trustee, Retail Employees Superannuation Pty Ltd (Rest), for allegedly making misleading representations about limitations on members’ rights to transfer superannuation funds out of the Retail Employees Superannuation Trust between March 2015 and May 2018.
ASIC Deputy Chair Sarah Court said, ‘Superannuation portability and choice of superannuation fund are important member rights.’
‘ASIC brought this action to clarify the law around those rights and to emphasise the critical responsibility of trustees to provide accurate information to their members. Members rely on and trust information they receive from their superannuation fund.’
ASIC will consider the judgment carefully. ASIC has 28 days to lodge any appeal to the Full Court of the Federal Court, should it decide to do so.
Background
Superannuation trustees are required by law to act in the best financial interests of members. Choice of fund and portability of funds are important rights for members. They allow members to consolidate accounts and, among other benefits, to avoid superannuation balance erosion through unnecessary fees and costs.
The Superannuation Industry (Supervision) Act 1993 and associated regulations required Rest to process full balance requests within three business days upon receiving specific mandatory information, subject only to some limited exceptions.
The obligation to process rollovers to another superannuation fund within three days was introduced in 2013 as part of the government’s SuperStream initiative to improve the efficiency of the superannuation system. Prior to this, rolling over and consolidating funds was a lengthy process which often ended in failure.
