APRA paying legal firms $3.5 million
Australia's superannuation regulator is paying three legal firms around $3.5 million as part of contractual arrangements around investigations into superannuation funds.
The figure has been revealed by the Australian Prudential Regulation Authority (APRA) as part of answers to questions on notice from Tasmanian Liberal Senator, David Bushby, during Senate Estimates.
Bushby had asked how many external legal contracts were in train in "relation to investigations of super fund matters, and the value of those contracts".
APRA responded that it currently had three external legal contracts valued at around $3.5 million.
Bushby had also asked APRA what would happen in the event of a superannuation fund losing a legal class action because of "false and misleading advertising based on overly optimistic 30-40 year projections of future returns".
"What would be the source/s of funds to meet such a contingency, and what would be APRA's advice to funds and trustees in relation to this matter?" the Senator asked.
APRA answered that if a Registrable Superannuation Entity (RSE) licensee was conducting the misleading advertising, it (APRA) would ordinarily refer the matter to the Australian Securities and Investments Commission (ASIC) because it related to disclosures made to fund members.
However, it said that in relation to the liability issue, most RSE licensees could be indemnified from the assets of the trust fund (subject to certain exceptions, such as when they have been dishonest, or intentionally or recklessly failed to exercise care and diligence, or been liable for a monetary penalty under a civil penalty order - ie, an ASIC fine).
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