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OnePath Custodians receives $5m penalty for fees for no service
Super trustee OnePath Custodians has been ordered to pay $5 million for fees for no service misconduct, the second penalty of this kind in a week.
The Federal Court ordered OnePath to pay the penalty for making false or misleading representations about its right to continue charging fees, and for failing to provide services to members efficiently, honestly and fairly due to its misleading conduct and by deducting fees when not entitled to do so.
The Court found that between December 2015 and November 2021, OnePath made false or misleading representations to members of the superannuation product ‘Integra Super’ about Adviser Service Fees and deducted $3.8 million in fees from members for advice services they did not receive.
OnePath told members they had to pay a fee for advice from a ‘Plan Adviser’ even after the member had been transferred to a division of Integra Super where they were not entitled to receive advice services.
OnePath also misled members by representing that:
- The member had agreed to the fee, when it had been agreed between the Plan Adviser and the member’s former employer; and
- The negotiation of the fee was a matter for the member’s former employer and the Plan Adviser, even though the member had their own right to cancel the fee.
During this period, OnePath issued letters to approximately 766 members and annual statements to approximately 15,962 members, containing the false or misleading representations.
ASIC deputy chair, Sarah Court, said: “This case highlights the importance of a super trustee charging fees correctly and providing accurate, clear and timely information to members about superannuation fees. Members should be confident that their retirement savings are not reduced over time by superannuation trustees making deductions from their accounts they are not entitled to make.”
The Court also ordered OnePath to publish a notice on its website regarding the breaches.
In June, OnePath Custodians was also fined $1.4 million by APRA for failing to direct member contributions to a MySuper product.
This is the second fees for no service penalty issued this week with Mercer Financial Advice being ordered to pay $12 million.
AUTHOR
Laura Dew
Laura Dew is editor at Super Review. Prior to joining SR, she spent five years working at Investment Week in the UK covering asset and wealth management.
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