Australian Super says improved processes will prevent multiple accounts repeat
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More news: AustralianSuper chief executive Paul Schroder said the fund has improved its internal processes since reporting the multiple-member accounts issue that led to the ASIC lawsuit.
What they said: “We found this mistake, we reported it, we apologised to impacted members, we compensated them, and we’ve improved our processes to prevent this happening again,” Schroder said in a statement following today's judgment, adding that multiple member accounts are an industry-wide problem.
Judge Lisa Hespe’s decision to impose a $27 million penalty on AustralianSuper followed a joint submission from the corporate regulator and the superannuation fund, agreeing that the figure was appropriate.
AustralianSuper to pay $27m in multiple accounts lawsuit
The news: AustralianSuper must pay a $27 million penalty for its failures to address multiple member accounts, Federal Court of Australia Judge Lisa Hespe has ordered.
The numbers: ASIC’s case alleged that about 90,000 members of Australia’s largest superannuation fund were affected over a 10-year period between 1 July 2013 and 31 March 2023, with total cost to members of approximately $69 million.
The context: ASIC sued AustralianSuper in September 2023 over alleged failures to address multiple member accounts.
ASIC alleged AustralianSuper failed to have adequate policies and procedures to identify members holding multiple accounts and merge these where it was in the member’s best interests. As a result, it continued to charge multiple sets of fees and insurance premiums to these members. It also alleged AustralianSuper was aware in 2018 of the number of multiple member accounts and possible gaps in its policies and procedures but failed to investigate and resolve the issue until late 2021 and early 2022.
AustralianSuper apologised to members when the lawsuit began, saying it regretted that its processes to identify and combine multiple accounts did not cover all instances of multiple member accounts.
The source: Federal Court
