Civil proceedings brought by either the Australian Securities and Investments Commission (ASIC) or the Australian Prudential Regulation Authority (APRA) will represent the greatest risk to superannuation funds under the Government’s controversial new Your Future, You Super legislation.
ASIC has spelled out precisely how it believes the controversial reversal of the evidential burden of proof will work and what it will mean for superannuation trustees charged with breaches of the proposed new best financial interests duty (BFID).
In a submission filed with the Senate Economics Legislation Committee, ASIC said that in “civil proceedings brought by a regulator for a breach of the BFID, a reverse evidential burden of proof will apply (new s220A)”.
“This means that the onus is on the trustee to point to evidence that suggests a reasonable possibility that there was a proper discharge of its duties. If the trustee is able to do so, a regulator seeking to take enforcement action must then prove, on the balance of probabilities, that the trustee did not perform the trustee’s duties and exercise the trustee’s powers in the best financial interests of beneficiaries,” it said.
“In practical terms, a reverse onus, of itself, will not materially change the scope of an ASIC investigation because ASIC must still investigate the circumstances of a suspected breach.
“We note that the reverse onus does not apply to additional BFID requirements that will be set out in regulations. Nor does the reverse onus apply where a criminal penalty is pursued by a regulator, or to class actions against trustees brought by beneficiaries or brought by the regulator on behalf of beneficiaries,” ASIC said.
Michael Lovett, who left the investment firm just three months after launching its Vanguard Super offering, has taken up a chief executive role at an Australian asset manager.
The Central Bank of Ireland has granted the approval of Equity Trustees’ exit from its Irish operations, with the transaction expected to be complete on 30 April.
Super returns continued to climb in March, raising hopes of delivering double-digit returns by June depending on the performance of this next quarter.
The dedicated super fund for emergency services and Victorian government employees is under fire for unpaid entitlements to transport employees, which could exceed $40 million.
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