The Chairman of ASIC

The following is a list of questions posed by Australian Guardians to the Chairman of the Australian Securities and Investments Commission (ASIC).

The incumbent Chairman of ASIC is Mr Greg Medcraft.

If you would like to ask the Chairman of ASIC a question in relation to the security of your superannuation and complaints you have concerning your Superannuation Trustee Email ausguardian@gmail.com or leave the question below.

Question on Notice – 12 July 2012

The first thing any Member of a Government Regulated Superannuation Fund should do if they receive a benefit payment is to write to the Trustee and request copies of the following Trust Documents:

  • The Trust Deed and Governing Rules and any Deeds of Amendment
  • Copies of recent Audited Accounts and Auditor’s Reports
  • A copy of the most recent Actuarial Report (if a final salary Defined Benefit Fund)

Even if the Trustee has paid the lawful benefit the Member has the legal right to have “peace of mind” that after years or decades of service that Member has received his or her lawful benefit and that an Officer of the Trustee did not pocket some of the money before writing the payment cheque.

Under Item 297B of Schedule 3 of the Corporations Act 2001 it is a criminal offence for a Trustee of a Government Regulated Superannuation Fund to refuse to provide copies of the Trust Documents list above to a Member or a Beneficiary of the Fund as required by subsection 1017C(5) of the Corporations Act 2001 and Regulation 7.9.45 of the Corporations Regulations 2001.

Under the Superannuation Industry (Supervision) Act 1993, ASIC has the power to “give a direction” to a Trustee of a Government Regulated Superannuation Fund to comply with the Trustee’s disclosure obligations under Section 1017C of the Corporations Act 2001.

Can the Chairman please give an explanation to the 12 million unique Members of Government Regulated Superannuation Funds as to why in the case of a Member who advised ASIC that the Trustee of his fund had refused to comply with subsection 1017C(5) of the Corporations Act 2001 over a two year period, ASIC then refused to take any enforcement action against that Trustee?

Fraudulent Member Benefit Statements were produced for several years in the recent Trio Capital Superannuation Fraud case, yet ASIC does not want Members of Government Regulated Superannuation Funds to be able to access the very Fund Documents that establish their lawful superannuation entitlements.

There is a legal maxim: “It is fraud to conceal fraud“.

Yet, it would seem that ASIC is only too willing to conceal fraud when it comes to Australia’s $1 Trillion compulsory Superannuation System.

Answer: Awaiting

Question on Notice – 13 July 2012

When the Member of a Government Regulated Superannuation Fund was unable to get ASIC to enforce that Member’s legal right to obtain copies of the Audited Accounts and Auditor’s Reports, Trust Documents  in which that Member had an “equitable interest“, that Member lodged a Complaint with the Minister of State responsible for Superannuation. The Minister asked an Officer in the Treasury to make inquires on the Minister’s behalf as to why ASIC had not “given a direction” (a 5 minute task) to the Trustee of the Fund in question to comply with the Trustee’s disclosure obligations.

In a response obtained under the Freedom of Information Act 1982 this is what a senior Officer of ASIC stated in his submission dated 25 October 2010 {ASIC Ref: CCU-10\0386 the Treasury Ref: 85189 available under the Freedom of Information Act 1982} to the Responsible Minister.

The Senior ASIC  Officer states:

“Mr X has also subsequently asserted that he has a right to be provided with copies of the audited trust accounts under Section 1017C of the Act. However although section 1017C  requires that trustees to give members or former members information that the person reasonably requires to understand any benefit entitlements that the person may have or to understand the main features of the fund, ASIC considers that this right does not extend to obtaining the audited trust accounts and that the Fund has complied with its reporting requirements under the Act”.

Yet what does Regulation 7.9.45(2)(b) of the Corporations Regulations 2001 actually say?

(2)   For paragraph 1017C (5) (a) of the Act, the following are prescribed documents:

(a)    the governing rules of the fund or pooled superannuation trust;

(b)    audited accounts of the fund or pooled superannuation trust, together with (whether or not specifically requested) the auditor’s report in relation to the accounts;

So in “black and white” a Member or a Beneficiary of a Government Regulated Superannuation Fund is entitled to a copy of the audited accounts and auditor’s reports of their own fund.

Even a “person” who is not a Member of the Fund is entitled to copies of these Trust Documents under SIS Regulation 2.33(2)!

Under subsection 13(1) of the APS Code of Conduct (Public Service Act 1999) an Officer of ASIC has to act honestly and with integrity.

Under subsection 13(9) of the APS Code of Conduct an Officer of ASIC must not provide false and misleading information in response to a request for information by the Responsible Minister or someone acting on the Minister’s behalf.

It is the responsibility of an Agency Head to ensure that all APS Employees in that agency comply with the APS Code of Conduct and to initiate appropriate disciplinary measures when there has been a contravention of the APS Code of Conduct by an APS employee in accordance with Section 15 of the Public Service Act 1999.

Therefore the question Australian Guardians is asking the Chairman is what disciplinary action, if any, has the Chairman taken against the Officer of ASIC who contravened subsection 13(1) and 13(9) of the APS Code of Conduct in the response to the Responsible Minister in the letter dated 25 October 2010?

Another question is: Why should 12 million unique Members of Government Regulated Superannuation Funds believe that their Super is Safe, if an Officer of ASIC can lie to the Minister of State responsible for Superannuation with impunity?

Answer: Awaiting

Question on Notice – 3 September 2012

Can the Chairman of ASIC confirm to the 12 Million unique Members of Government Regulated Superannuation Funds that it is ASIC‘s policy to only take enforcement action in relation to Superannuation Fraud:

  • (i) After the event when a superannuation fund has become insolvent and the receivers are called in so a cover-up of fraud is no longer possible, or
  • (ii) When ASIC assesses that insolvency is imminent and so ASIC‘s hand is forced.

Otherwise ASIC has given its tacit approval to Superannuation Trustees that ASIC will “turn a blind eye” to fraud provided the fraud is not so large as to cause the insolvency of the Fund and a cover-up is no longer possible?

It this is not the case can the Chairman explain why Responsible Officers of Government Regulated Superannuation Funds can commit criminal offences without the intervention of ASIC? That is Responsible Offices can conceal the cause of action for a Breach of Trust from the Members and Beneficiaries of the Fund with the approval of ASIC.

Answer: Awaiting

Question on Notice – 3 October 2012

Can the Chairman of ASIC confirm that ASIC received no complaints from any shareholders of Fortescue Metals Group nor any Members of the public yet the previous Chairman of ASIC, Mr Tony D’Aloisio, committed tens of millions of Australians Tax Payers’ money on an allegation that Mr Andrew Forrest had failed to comply with his disclosure obligations.

Can the Chairman also confirm that the former Chairman failed to comply with his own disclosure obligations under Section 123 of the ASIC Act 2001 to two Responsible Ministers, namely the Hon Chris Bowen MP and the Hon David Bradbury MP, as confirmed by documents obtained under the Freedom of Information Act 2001 here

Answer: Awaiting

 

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