More cyber-crims targeting DIY super, ASIC warns

The corporate regulator has warned there is a growing amount of crime in the DIY superannuation space, warning members their funds are attractive to international criminal syndicates.

ASIC chairman Greg Medcraft said superannuation was expected to grow by trillions over the next few years, and warned that the regulator’s watch over the industry will need to increase as a result.

The space will also require more attention as the population continues to age, he said in a speech last week.

“Because of self-managed super we are seen as having a large pile of money in this country which is available to invest and that’s very attractive to international crime organisations,” he said, according to Fairfax.

But Andrea Slattery, chief executive of the SMSF Professionals’ Association of Australia, told SmartCompany this morning that while the problem exists, it affects the entire financial services industry and not just DIY funds.

“There is very little crime within the SMSF sector, but the issue of crime attacking the financial services sector in Australia is a far broader issue and really requires an industry-wide solution,” she says.

“No sector is any more attractive to the crime gangs than any other sector; this is an Australia-wide issue.”

Nevertheless, both warnings suggest entrepreneurs would do well to be wary of scams in the financial services sector and guard their super carefully.

Crime in this space has been growing over the past few years, especially as perpetrators turn to digital and more advanced techniques. ASIC has warned more investors are using digital scams to steal money.

Medcraft said last week it’s often men aged over 55 who are getting caught in these scams. Usually these investors are quite sophisticated and thorough – which is a testament to the professional appearance of some of the scams.

“The increased risks in complex products are not just faced by retail investors,” he said last week.

“The global financial crisis provided clear examples where non-retail investors such as universities, councils, endowment funds, incurred severe losses from investing in structured credit instruments they did not understand.”

 

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