From 1 October this year, the SuperStream standards became mandatory for all rollovers to and from SMSFs. The new standards require a trustee to roll over or transfer an amount no later than three business days after the trustee received the rollover or transfer request, or if the trustee requires further information, the date the trustee receives that information.
SMSF Association deputy chief executive Peter Burgess said the new SuperStream system is not working as efficiently as the association would like, with rollovers not occurring in the prescribed three days.
“We are somewhat concerned by some of the APRA-regulated funds that seem to be taking a long time to roll money to SMSFs, even where the request complies with the SuperStream standards,” explained Mr Burgess.
Mr Burgess said there are situations happening where the trustee has done everything correctly under the SuperStream rules but the APRA fund is still imposing ID checks on the trustee, which are unnecessary in some cases.
“We understand that with cyber-security being such a big issue, it’s important that the APRA-fund does make sure that the money is transferred to the correct bank account but I think we have to have a balance in place,” Mr Burgess told SMSF Adviser.
“Where there is a match in the data that they’re receiving from the ATO and it matches their own data, then there shouldn’t be a need for further checks.”
Mr Burgess said there is further work that needs to be done in this area.
“We need to get the right balance between checks which ensure there is no risk of fraud, but at the same time, doesn’t impose unreasonable requirements on SMSF trustees,” he said.
I’ve had to deal with hundreds (yes hundreds) of SuperStream rollover requests since 1 October 2021. Teething problems were expected and encountered, but the arrogant attitude of industry super funds when it comes to complying with SIS Regulations I’ve encountered is disgusting.
Industry Super Funds didn’t want this change, fought against it, got it delayed and now it’s in finally place they’re basically ignoring it and making up their own rules that directly go against the Regulations.
APRA needs to take them to task. ID verification is the first issue. Electronic verifications of member identities needs to be made mandatory. Forcing members to send physical copies of ID via snail mail is an intentional delay tactic and doesn’t reduce the risk of fraud.
The second issue is verifying SMSF bank details. Providing a bank statement (or equivalent confirmation letter) can only be asked for to confirm that the account details for payment, not as another excuse to delay payment or to meet their ‘internal policies’.
Gloves are off. AFCA complaints lodged, APRA informed. They MUST be pulled into line!