The Australian Securities and Investments Commission has issued a warning to Coffs Harbour locals to be on the look out for fraud superannuation specialists who are promoting the set-up and illegal use of self-managed super funds.

According to ASIC, the spruikers are setting up shop outside of shopping centres and speaking to individuals on the street to convince victims to establish SMSFs through them.

The fraudsters are selling consumers on the fake promise of drawing on their newly set-up SMSF to pay off debts, purchases cars, start businesses or buy property.

They also claim consumers can do so without any upfront fees for service.

ASIC has taken the opportunity to recommend potential SMSF members to consider carefully whether establishing a self-managed fund is right for them, as well as speak to an authorised financial adviser before entering into an SMSF arrangement.

“Setting up and running an SMSF is a complex and costly process, and consumers could end up losing a significant amount of money if they get it wrong,” ASIC stated.

“A breach of the ATO’s superannuation rules may result in the consumer facing hefty fines of up to $16,800.”

The corporate regulator advises consumers look up their potential financial adviser on the ASIC Financial Advisor’s Register before committing as a customer in order to ensure the advice provider is professionally authorised.