Investors in self-managed superannuation funds should be required to sign a written agreement acknowledging a warning that their funds would not be compensated for theft or fraud, the Australian Securities and Investment Commission told a Senate estimates committee last night.
The Australian Financial Review reported that the head of ASIC said the corporate watchdog would ask the Federal Government to introduce requirements that would force investors to sign a written acknowledgement before setting up an SMSF and every two or three years after that.
The move by ASIC comes after SMSF funds were deemed not eligible for compensation after the $176 million collapse of Trio Capital in 2009.
“I think it is actually frankly quite important that Australians who have self-managed super clearly acknowledge that they basically don’t have that protection,” ASIC chairman Greg Medcraft told the Senate committee according to the newspaper report.
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Peter Burgess, technical director of the Self Managed Super Fund Professionals’ Association, told SmartCompany that ASIC was getting carried away.
“I think we need to be careful not to get too carried away with this; where do you draw the line?” Burgess says.
“People going into superannuation funds, if they become non-residents, run the risk of their fund becoming non-compliant should they also sign a declaration?