Govt urged to act on super legislation

Superannuation funds should be handled in the same way as banks, insurance companies and other authorised deposit-taking institutions (ADIs) on the question of business transfers and group restructures, according to the Association of Superannuation Funds of Australia (ASFA).

The issue has been raised by ASFA in a submission to the Australian Transaction Reports and Analysis Centre (AUSTRAC), which has issued draft rules regarding the anti-money laundering/counter-terrorism financing (AML/CTF) regime.

The new rules are intended to cover the circumstances where the business of a failing financial institution is transferred to a sound financial institution under a ‘compulsory transfer of business’, and allow the receiving institution to seek a 30 extension for the purpose of carrying out appropriate customer identification.

ASFA has pointed out the draft arrangements do not apply to superannuation entities and has suggested recent events including that of Trio Capital Limited (Astarra Capital Limited) make it appropriate that superannuation trustees be included.

It said the Government’s ‘Stronger Super’ reform package had proposed to grant the Australian Prudential Regulation Authority greater administrative powers to regulate the superannuation industry including giving it broader powers to act against trustees for breaches of the Superannuation Industry Supervision Act.

“ASFA suggests that, given the Government’s policy position on strengthening the regulatory framework for superannuation entities as set out in its Stronger Super document, now is an appropriate time to consider amending the AML/CTF rules so as to capture the compulsory transfer of a superannuation fund to a new trustee following an APRA determination,” the submission said.