SPAA demands better fraud cover for SMSFs

Self Managed Super Fund Professionals' Association of Australia (SPAA) says fraud and theft is not limited to superannuation but all Australian investors.

SPAA made its announcement at its Technical Conference in Sydney today after a Parliamentary Joint Committee inquiry into the collapse of Trio Capital.

SPAA CEO Andrea Slattery said the last resort compensation scheme afforded to APRA regulated funds should also be afforded to all investors irrespective of the financial service provided.

“Under the current regime some investors are compensated while others are not and we don’t believe that’s right,” said Slattery.

“We acknowledge that SMSF investors have made a consensus decision to make their own investment decisions but that should not mean they are left to fend for themselves if they lose money due to the criminal acts committed by someone else.”

SPAA said the scheme would work by placing a levy on different industry sectors as well as product providers.The levy would be dependent on past events and would not be imposed on any individual investors.

SPAA also believes ASIC should be doing more in terms of reviewing and monitoring insurance policies held by Australian Financial Services (AFS) licensees.

SPAA suggests a standard policy which would drive scale among insurers and ultimately provide better cover for clients.

"We will continue to work with Government to ensure the new data transfer standards will not impose unreasonable restrictions on these funds," Burgess said.