SPAA backs ASIC on property spruikers
The Self-Managed Super Fund Professionals' Association of Australian (SPAA) has indicated its full support for recent statements made by the Australian Securities and Investments Commission (ASIC), warning the real estate industry about agents recommending investors' use of SMSFs to invest in property.
Commenting on last week's announcement, Andrea Slattery, CEO of SPAA, said that the ASIC warning had been timely.
"The ASIC warning is both timely and needed in light of the enormous media attention that has been given to this issue in recent months," she said.
"From SPAA's perspective, it's been our constant stance on SMSFs investing in property that there are technical dangers, and as such we have always recommended that trustees get professional licensed advice, either from a professional SMSF adviser who holds a licence or is an authorised representative of a licensee.
"We took that position a year ago in a detailed technical bulletin to all our members warning of the risks of property investment, and it remains our position today."
According to Slattery, property is an investment option for an SMSF but, like any investment, it must be suited to the fund and take into consideration the individual member's circumstances.
"In relation to property, there may be an interest in this asset class now because, in a low interest environment, people are looking for investment opportunities with higher yields than cash or bonds, and while there are still fears held about equities," she said.
"It's exactly because of this heightened interest in property that the regulator should be on the front foot to warn the real estate industry that its members must use licensed advice when recommending setting up an SMSF or recommending an SMSF acquires a property.
"ASIC is the 'consumer awareness' regulator and gained new powers on 1 July 2013 to target inappropriate marketing and spruiking within the financial services sector."
Originally published by SMSF Essentials.
Recommended for you
The financial services technology firm has officially launched its digital advice and education solution for superannuation funds and other industry players.
The ETF provider has flagged a number of developments as it formally enters the superannuation space through a major acquisition.
While all MySuper products successfully passed the latest performance test, trustee-directed products encountered difficulties.
Iress has appointed Insignia Financial’s former general manager of master trust and insurance products as its newest CEO of superannuation, who will take over from Paul Giles.
