Powered by MOMENTUM MEDIA
subscribe to our newsletter sign up

Alarm sounds on fees in superannuation

ASIC

The corporate and banking regulators have issued a stern warning to superannuation funds on the transparency and appropriateness of fee structures. 

In a letter issued from both APRA and ASIC to superannuation funds, the regulators have called for a review of risk management and oversight processes.

The regulator is aiming to ensure that only authorised and appropriate fees and other charges are deducted from members’ superannuation accounts. They are also aiming for prompt resolutions of any fee disputes. 

“Separately, we have identified a range of industry practices in relation to trustee oversight, many of which fall below the standard we expect. A number of these matters are the subject of enforcement investigations or actions,” said Danielle Press, ASIC commissioner. 

Advertisement
Advertisement

“This raises concerns about some trustees’ risk governance, capabilities and culture, as well as their ability to appropriately manage conflicts of interest," she said. 

Financial advice fees in the spotlight

The banking royal commission last year shone a spotlight on the practice of fees for no service, and also unclear fee charging practices in financial services. 

The letter flagged a number of issues that should be considered in relation to the deduction of financial advice fees from superannuation funds. 

“Trustees should consider all necessary steps to make sure that members are clearly aware of fees being deducted from their account. Best practice would be to obtain effective consumer authorisation to charge the fees on a regular basis,” it said.

“In addition, there should be ongoing disclosure of the fees containing the specifics of the adviser receiving the fee, rather than relying on historical disclosure.”

 

Alarm sounds on fees in superannuation
ASIC
nestegg logo
subscribe to our newsletter sign up
FROM THE WEB
Recommended by Spike Native Network
Neil - I retired about a year ago and now I've got less income than I planned for. Can I sue my financial planner?....
Joe - Agree with Terry Dwyer. The really nasty part is the way it will hit self funded retirees (through their SMSF in many cases) who have direct shares.......
John - Not sure loss of 30% of income is something I just let go. Options I will be doing is investing overseas, local and international REITs and seeing if.......
Dr Terry Dwyer, Dwye... - I am amazed by these comments. The effects will be subtle but pervasive. It will have a huge effect on superannuitants in pension mode as with low.......