ASIC boss Joe Longo warns trouble for super trustees who ignore his readings of the riot act
After a swathe of negative reports and launching legal actions against high profile funds, Mr Longo said his team had read the riot act to an industry holding the trust and savings of millions of Australians.
He claimed none of the trustees of 10 funds caught up in a recent review of death benefits claims had performance objectives for the end-to-end handling times, nor did they monitor this performance.
Mr Longo told a regulator's lunch that the super industry had a 'solemn responsibility to protect the interests of all Australians, and to give them every confidence their money will be there, readily available, when it's needed'.
'To the extent that some trustees aren't across the data, systems, and processes of their funds, they're failing to live up to that solemn responsibility,' the ASIC chair said.
And there would be trouble for any trustees 'who fail to know their business, inside and out, and to act in the best interests of their members'.
Releasing its review of death benefit handling in March, ASIC said it found many examples of excessive delays and poor service, ineffective and insensitive communications and inadequate support for vulnerable claimants.
That review was triggered by a tripling in super customers seeking help from the Australian Financial Complaints Authority between 2021 to 2022.
ASIC reported what is described as a 'huge variation' in claims handling times across the 10 funds targeted. ASIC claimed 78 per cent of claim files had delays caused by processing issues within the control of fund trustees.
Mr Longo said ASIC's work had laid bare governance challenges at super funds and exposed trustee blind spots around their data, systems and processes.
The next phase of his agency's work with funds would involved addressing these boardroom blind spots. 'Our focus is on how trustees learn from — and respond to — the complaints they receive,' he said.
'No business can thrive without understanding the people it serves. To do this, it needs market feedback. And a primary source of this feedback is – and always will be – customer complaints.
'If you don't have the right information to make good judgements, you simply cannot govern effectively. It's that fundamental.'
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