Regulator flags ‘concerning conduct’ putting super members’ funds at risk

ASIC is seeing an increase in misconduct exploiting superannuation, it stated in its latest annual report.

The regulator stated that it is observing a range of concerning conduct that puts people’s superannuation funds at risk.

“As superannuation has grown, we are seeing an increasing number of people considering options such as self-managed superannuation funds (SMSFs) or potentially risking their retirement savings by investing in complex schemes or high-risk products,” the report stated. 

“As a protective measure, in June 2025 we launched a consumer warning campaign calling on Australians to be on red alert for high-pressured sales tactics, clickbait advertising and promises of unrealistic returns, which encourage customers to switch superannuation into risky investments.”

In the report, ASIC also reminded the financial advice sector of its concerns about business models that use high-pressure sales tactics.

In a keynote address in June, commissioner Alan Kirkland reiterated expectations to advice licensees that they have a role in preventing misconduct in terms of ensuring their representatives are well-supervised and acting in the best interests of clients.

“Our recent investigations have identified suspected misconduct, including the involvement of lead generators and financial advisers advising consumers to shift superannuation savings into complex, high-risk schemes,” the report continued.

“We have also focused on taking targeted enforcement action against cookie-cutter advice to roll funds into SMSFs and superannuation switching models that result in the inappropriate erosion of superannuation.”

The report highlighted the work it had done in this area with the $11 million penalty imposed on DOD Bookkeeping Pty Ltd in April this year following Federal Court proceedings.

The action was taken in response to DOD Bookkeeping previously Equiti Financial Services Pty Ltd (Equiti FS) for breaching conflicted remuneration rules and for inappropriate “cookie-cutter” advice given by its advisers.

ASIC’s case concerned $130,250 in bonuses paid to three financial advisers who provided template advice to clients to roll over their superannuation into self-managed super funds and use those funds to buy property through a related entity, Equiti Property Pty Ltd.

The court found that the bonuses paid to the three advisers, which were paid when the clients settled on property offered through Equiti Property, influenced the advice they provided and also breached conflicted remuneration laws.

It also found that in the case of 12 sample client files, the advice failed to consider each client’s individual circumstances or objectives.

“ASIC took this action to deter misconduct relating to financial product advice and the deliberate exploitation of superannuation savings,” the report stated.

“The court found that there was little or no heed paid to the particular circumstances of the individual clients, they were not given sufficient time to understand the advice given to them, and the advice was focused on manoeuvring them into property purchases through self-managed super funds.”

ASIC cancelled Equiti FS’ Australian financial services licence on 7 November 2024.

Furthermore, the report stated that over the past 12–18 months, ASIC has become increasingly concerned with what appears to be a significant increase in unscrupulous business models, on an industrial scale, which deprive people of their superannuation savings.

“This is commonly done through high-pressure selling and promises of better returns in exchange for the investment of superannuation savings into complex and risky schemes,” it stated.

“ASIC’s priority is to investigate what has happened, which has revealed a complex structure and suspected misconduct by lead generators, financial advisers and others. To raise awareness and protect consumers, we launched a warning campaign educating investors about taking unwise risks with their retirement savings.”