In a public statement, ASIC said it has commenced civil penalty proceedings against financial technology company, Squirrel Superannuation Services Pty Ltd, which holds an AFSL.
ASIC alleges that from January 2015, Squirrel marketed and sold services helping customers establish and operate self-managed superannuation funds (SMSF) to purchase established residential property.
In March 2015, ASIC said that Squirrel first published and distributed a brochure headed “How buying established residential property can super charge your superannuation?”.
The corporate regulator alleges that between March 2015 and July 2018, Squirrel provided the brochure to thousands of members of the public by email and distributed hard copies at a seminar held on 28 April 2015.
ASIC alleges that Squirrel in its brochure made misleading representations that:
- … “residential property in metropolitan locations doubles in value every 7-10 years and generates a rental return of around 4 – 5% per annum”;
- Using a deposit from an SMSF to purchase residential investment property could obtain certain average returns.
- There is a “remarkable” difference in returns between investing in a regular superannuation fund (7 per cent) and using an SMSF that purchased residential property (14 per cent).
- The costs of managing an investment property through an SMSF are “surprisingly low” compared with using a financial planner to select a series of managed investment funds.
In July 2018, Squirrel ceased distributing the brochure following communications with ASIC. In December 2018, following further inquiries, ASIC commenced a full investigation, culminating in the filing of these proceedings.
ASIC said it is seeking declarations, pecuniary penalties and cost orders against Squirrel.
The date for the first case management hearing is yet to be scheduled by the court.
In its statement, ASIC said consumers need to be able to make confident and informed decisions about setting up and managing an SMSF, based on good quality, appropriate and accurate advice and information.
ASIC stated that SMSFs are a key part of the superannuation sector and represent approximately 26 per cent of total assets held. There are now over 591,000 SMSFs, holding an estimated total value of assets of just over $728 billion.
“A healthy and sound SMSF sector is important for the operation of Australia’s superannuation system. Supporting this system is a key priority for ASIC,” ASIC said.
“The provision of misleading information about SMSFs undermines the SMSF sector and limits the ability of Australian consumers to make confident and informed decisions about their superannuation savings.”
[i]”In its statement, ASIC said consumers need to be able to make confident and informed decisions about setting up and managing an SMSF, based on good quality, appropriate and accurate advice and information.”[/i]
……such as ASIC’s fact sheet on the costs of operating a SMSF…???
ASIC is totally corrupt via Regulatory Capture in cahoots with all things Industry Super. Just like this disgusting abuse of the ASIC False Facts Sheet. Even when busted ASIC deny wrong doing and won’t put out a correct Fact Sheet as it would not be anti SMSF as they wanted.
So conflicted
So corrupt is our ASIC
Only took 6 years.
Lol