Stressed Australians tempted by illegal super access

Current stressed market conditions may be encouraging people to seek illegal early access to their superannuation, according to the Australian Securities and Investments Commission (ASIC).

In a statement issued following a number of recent prosecutions relating to illegal early access to superannuation, the regulator said it was aware that in a market downturn, financially stressed people might seek to access to cash now.

It said that the negative returns experienced by some major superannuation funds might cause some members of those funds to consider other ways to achieve better returns.

“Most illegal early release and access schemes involve the establishment of a self-managed superannuation fund (SMSF) either in the name of the promoter or the member who is attempting to access superannuation monies early,” ASIC said.

It said that promoters of the schemes might then steal the money that was being rolled over by the member from the regulated super fund or charge large commissions for assisting in the set-up of the scheme.

ASIC’s concern at the upturn in instances of illegal early access to superannuation has prompted it to produce a brochure warning people of the dangers and providing information to people on how they can legally deal with financial stress.