ASIC has warned superannuation Trustees that promoting direct investment options as “self-managed” could potentially give investors the mistaken impression that the Fund offered the same level of choice and control as a self-managed superannuation fund (SMSF).
The compliance issue observation was one of several made by ASIC subsequent to its proactive surveillance of responsible entities and superannuation trustees that are also holders of an Australian financial services (AFS) licence.
ASIC Commissioner Peter Kell said that while some compliance issues were expected, there were some areas where processes and behaviours could be improved across the board.
‘ASIC reminds superannuation trustees that when developing and implementing strategies designed to gain and retain fund members, they should be mindful of the financial services laws and ensure that any communications to new or existing members is not misleading or deceptive,” Mr Kell said.
Responding to ASIC?s warning, SMSF Association Chief Executive Officer/Managing Director, Andrea Slattery, said the announcement was timely.
“What’s interesting is that these direct investment options are being likened to an SMSF – an erroneous and misleading comparison,” said Ms Slattery.
“Self-Managed Superannuation Fund (SMSF) is a defined term in the law and no-one is able to mislead consumers into thinking they are getting something similar in another option.
“The fact is these direct investment options in the APRA funds typically don’t have the range of investment choice or the flexibility of an SMSF. A duck is not a chicken, and an APRA fund is not an SMSF, no matter how it is dressed up. It is either an SMSF or it is not.”