Advocates Warn that Urgent Change is Needed to Protect Retirement Savings from Dodgy Advice

Super Consumers Australia warns of Royal Commission rehash: Super funds need to do more to protect people from bad advice

Today ASIC has released a report highlighting the failure of many super funds to uphold their duty to protect people from being charged for inappropriate, costly advice from their super savings. This follows revelations from ASIC earlier this week that Australians are being caught out by cold-callers and social media advertisements that trick them into signing up for inappropriate advice with costly switching fees. The poor practice is seeing people potentially hundreds of thousands of dollars worse off in retirement.

“It’s appalling that some funds are not closely monitoring fees and deductions from their members’ super. It is a super fund’s job to protect people’s retirement savings from rip-off fees and services, but ASIC found that three of the funds they looked at were failing to even do basic checks of advisor fee deductions. This comes despite regulator warnings to improve on this back in 2021,” says Xavier O’Halloran, Director of Super Consumers Australia. 

The Government needs to do more to ensure funds are protecting members from inappropriate fee deductions. It should resist industry attempts to water down existing protections. The Government also urgently needs to introduce a ban on unfair trading to put an end to inappropriate advice spruiking once and for all.

“Unfortunately, some funds and advisers are forgetting the lessons of the Financial Services Royal Commission and the horror of ‘fees for no service’. Right now, some within the industry are calling for the removal of obligations on super funds to protect people from inappropriate advice fees. We’re calling on Assistant Treasurer Stephen Jones to protect the savings of Australians from dodgy practices by retaining these protections,” says O’Halloran.

“It is good to see ASIC shining a light on poor practices. We expect ASIC to now follow up with strong enforcement action against trustees and advisers to deter future misconduct.”

Advisers should welcome the reforms currently before Parliament, which provide clarity and certainty about how advice can be appropriately charged from super. Those who are genuinely acting in their clients’ best interests have nothing to fear.

“Unfortunately, people need to be extra cautious about cold-calling and malicious click-bait ads on social media. If you’re approached by a cold caller about your super, just hang up, or if you see click-bait advertisements on social media, just scroll past”.

Above is a media release (9/05/2024) from Super Consumers Australia. Below are the media contact details for SCA and a link to the referenced ASIC report and media release.

SCA media contacts: Antoinette Dyce, (02) 7908 6323 (Wed-Fri),; Daniel Herborn, (02) 7908 6323 (Mon-Tue),

Click here for the ASIC report and here for the media release.