Dear Australian Securities and Investments Commission,

I am lodging a request for documents pursuant to the Freedom of Information Act 1982 (Cth) that relate to the statutory obligation of the Australian Financial Complaints Authority (AFCA) to comply with subsection 1052E(1)(b) of the Corporations Act 2001 and ASIC Regulatory Guide 267 – Oversight of the Australian Financial Complaints Authority

    (1)  If AFCA becomes aware, in connection with a complaint under the AFCA scheme, that:
                     ……….
(b) a contravention of the governing rules of a regulated superannuation fund or an approved deposit fund may have occurred; ………….

AFCA must give particulars of the contravention, breach, refusal or failure to one or more of APRA, ASIC or the Commissioner of Taxation.

The “governing rules” of a Regulated Superannuation Fund consist of the original Trust Deed that constituted and established the fund and all valid amending Deeds read as “one legal document” and include statutory provisions such as Sections 52 and 52A of the Superannuation Industry (Supervision) Act 1993 {SIS Act} and relevant State legislation.

Background

The Senate Economics Reference is currently conducting and inquiry Australian Securities and Investments Commission investigation and enforcement and AFCA has made a submission to this inquiry and included a document titled “Systemic issues insights report Financial year 2021-22” in which case studies related to compliance with the SIS Act and/or SIS Regulations are included.

These case studies related to relatively minor contraventions such as overcharging of insurance premiums and a delay in processing rollover requests by fund members.

This raises a question for the Senate Committee as to whether AFCA is selective in compliance with Section 1052E of the Corporations Act 2001, only referring relatively minor contraventions to ASIC (and/or APRA) and not more serious contraventions that might give rise to a Parliamentary Inquiry as was the case with the Trio Capital Superannuation Fraud.

In this matter, AFCA was provided with a copy of a legal opinion of a former Attorney-General of South Australia that confirmed that MALE members of a particular Defined Benefit fund constituted and established by a Trust Deed made on 23 December 1913 in the State of South Australia were and are entitled to a life pension if they completed at least 15 years of service while a fund member, with their widows entitled to a survivorship pension.

In Paragraph 35 The Chairman (Attorney-General) states:

“If a man had been 15 years in the company’s service and was retired say, for redundancy, he would be entitled to a pension under these rules, but if he left on his own accord, say, to go to another job he would simply get back his own contributions plus interest.”

In Paragraph 46 The Hon. S.C. Beven asks:

“Where he has been there for 15 years or more and the company retires him because they did not want him for some reason he would immediately become entitled to a pension?

In Paragraph 47 The Chairman responds:

“Irrespective of his age? ---Yes. That is covered by pararaph (d) {In Regulation 29}.

But was was the situation with respect to FEMALE fund members?

Two enactments of the Parliament of South Australia confirm that a separate non-contributory pension scheme was established for FEMALE staff and that this non-contributory pension scheme was closed to new members in 1963 and replaced by a contributory pension scheme providing higher pension benefits that was constituted and established by an original Trust Deed made on 17 December 1963.The original trustees of this separate fund were John Neil McEwin, Henry Norman Giles and Geoffrey Wyatt Docker.

These enactments confirm that a trustee would contravene the governing rules of the fund (ie commit a breach of trust) contituted and established by the original Trust Deed made on 23 December 1913 for the provision of pensions to MALE fund members.

NULIS should comply with Section 29QB of the SIS Act and SIS Regulation 2.38 and make a copy of the original Trust Deeds and copies of all amending Deeds for both funds available for download on the public section of its website so that MALE fund members and their widows can check on their superannuation entitlements as well as FEMALE fund members and their widowers, however, for the last decade NULIS has not complied with these public disclosure requirements.

The opinion of a former Attorney-General of South Australia should be sufficient justification for AFCA to conclude that a contravention of the governing rules may have occurred with respect to the payment of benefits by NULIS on or after 1 July 2016 to both MALE and FEMALE fund members.

The document or documents I seek is/are any correspondence from AFCA to ASIC that makes mention of NULIS Nominees (Aust) Ltd making benefit payments to FEMALE fund members from the Trust Estate (fund) constituted and established for MALE staff by the original Trust Deed made on 23 December 1913 (which would be prohibited as confirmed by two enactments of the Parliament of South Australia).

It is only necessary for AFCA to conclude that a contravention of the governing rules MAY have occurred to enliven subsection 1052E(1)(b) of the Corporations Act 2001.

AFCA can hardly ignore a case where an employer-sponsored superannuation fund appears to have “vanished” – where did the assets of the fund go!

The search period is from 20 May 2021.

Yours faithfully,

P.C. Sweeney