Speaking to SMSF Adviser, ASFA’s chief executive officer, Pauline Vamos, said she believes trustees need consumer protection, especially with the number of drivers for SMSF set-up increasing.
“With so much money in SMSFs and with the superannuation system tax concessions being taxpayer-funded, we really need to think about the consumer protection and the duty of care over that money,” she added.
“The main point is that there are so many different types of people in SMSFs, you cannot assume that they are all sophisticated investors,” she said.
Ms Vamos believes many SMSF trustees do not understand that they have limited protection as consumers.
“Trustees don’t have compensation if things go bad, they don’t necessarily have access to free consumer dispute resolutions either,” she said.
“What I think is we have to recognise the growth of this financial product and the types of investments that are part of that product are outside the consumer protection provisions,” she added.
“What I am saying is things have moved on, and it is time to review…where there are gaps in consumer protection laws around SMSFs,” she added.