RG 97 does not protect members on platforms

The corporate watchdog’s guidance on fee and cost disclosure, Regulatory Guide 97 (RG 97), does not go far enough in protecting members that have their superannuation invested across platforms, according to the Australian Institute of Superannuation Trustees (AIST).

AIST chief executive, Eva Scheerlinck, told Super Review, that while the Australian Securities and Investments Commission’s (ASIC’s) guidance was an important step forward in disclosure and transparency of super products, it did not go far enough to protect the interests of members who had their super invested across platforms provided by banks and investment managers.

The guide said that “fees and costs of accessible financial products made available through a platform are not required to be disclosed (in most circumstances) in the PDS (or IDPS Guide) or in the periodic statements of the platform”.

ASIC said that as the member, rather than the platform operator, chose to invest in a particular financial product and received disclosures about the product, the accessible financial product “is not considered to be an interposed vehicle for the purposes of fees and costs disclosure”.

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“Key exemptions for platforms continue to exist which means consumers in these products are not getting the full story and may actually think they are less expensive than they are,” Scheerlinck said.

“The exemptions also make it impossible to compare platforms and non-platform superannuation products. 

“Platforms are a huge portion of the Australian financial system and members should not have to wait for platforms to be brought into line with improved disclosure requirements.”

AIST’s submission to the consultation of RG 97 in April noted that platforms were a huge portion of the Australian financial system and members could wait no longer for platforms to be brought in line with improved disclosure requirements.