Super advice and fund regulation update

Superannuation choice begins on 1 July 2005, and by 28 July 2005, around five million employees will have received a form
giving them the option to choose the fund into which their compulsory superannuation guarantee contributions will be paid.

ASIC has announced it will use 300 real consumers ("shadow shoppers") to check what advice
people are given when they seek information about their superannuation.

ASIC’s survey will cover the full range of superannuation advice, namely:

  • all financial advisers, including banks, financial planners and accountants;
  • advice on retail funds, industry funds, corporate funds and self-managed super funds; and
  • all states and territories.

 ASIC will also be checking whether the financial advice complies with the law, particularly whether advisers have met their legal obligations related to switching. These obligations include that the adviser finds out about the client’s current superannuation arrangements and considers any potential lost benefits or transfer costs before recommending a change.

The transition period during which current APRA regulated trustees must be licensed by APRA and entities registered will expire on 30 June 2006.

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