Fund Product, Company and Regulatory Updates as at 17 July 2017

Product Updates

Cbus to reduce premiums
Industry super fund Cbus and TAL have signed a new insurance deal that will see substantially reduced premiums for Cbus members. Premiums per unit of death and total and permanent disability for most members will reduce by 25 per cent, while premiums for 15-44 year old manual labour members will be increased. Young members' default insurance costs will be reduced from $7.16 per week to $2.68. These changes will come into effect as of 20 September.

Hostplus drops premiums
Industry super fund Hostplus has reduced death and total and permanent disability premiums by six per cent as of 1 July with the reductions locked until 2020. 

Company Updates

IOOF appoints asset consultant
Mercer Australia has been announced as IOOF Investments' new asset consultant following the end of the Russell Investments contract on 30 June.

Class Super consolidates with two boutiques
Class Super has joined forces with A.S.A.P. Advice and Super Know How, two self-managed super fund service providers, to help scale audit and compliance services. The partnership allows unlicensed accountants to continue giving tax advice to self-managed super fund (SMSF) clients with minimal disruption. Super Know How's integration with Class Super technology will simplify audit request submissions for SMSF administrators and accountants.

Regulatory Updates

Huntley to pay penalty
Huntley Management Ltd has been ordered to pay a penalty of $50,000 by the Federal Court of Australia after failing to pay infringement notices given by ASIC for false and misleading advertising. Huntley made statements on its website between September 2010 and October 2015 and placed two advertisements in a national newspaper in November 2014 and February 2015 about investment projects 'approved by the Australian Securities and Investments Commission'. These projects had not been approved by ASIC.

ASIC acts to improve transparency
ASIC has intervened in relation to 21 superannuation trustees to improve transparency information on their websites. ASIC reviewed company websites to ensure easy access to important information, with some company websites falling short.

ASIC warns about Skyllex
ASIC has issued a warning to the public not to use a website that promotes financial investments offered by Skyllex. ASIC has concerns that Skyllex's website contains false, misleading or deceptive statements. Skyllex has been issued with a Certificate of Registration by ASIC, however it does not have an Australian financial services (AFS) licence and is not authorised to provide financial services. The website states partnerships with organisations that have confirmed there is no record of any. Investigation into the company's certificate of registration is continuing.

ASIC takes action over misuse of certificates
ASIC has concerns that some accountants have been inappropriately providing 'sophisticated investor' certificates. Some accountants have facilitated retail investors acquiring shares without receiving a prospectus or other disclosure documents, as if they were considered sophisticated investors with the appropriate certificate. 

NAB makes corrective disclosure about wealth management business
An ASIC investigation into a number of advice licensees within NAB Group has led to corrective disclosure being made to customers. Insufficient disclosure was provided to customers concerning the associations or relationships between advisers, employees, authorising licensees and issuers of financial products. 

ASIC cancels Grey Oak AFS license
Sydney-based company Grey Oak has had its AFS licence cancelled by ASIC for failing to lodge financial statements and auditor's reports for the 2013, 2014, 2015 and 2016 financial years. 

Government closes super tax loophole
The Federal Government has closed a loophole that allowed some superannuants to reduce tax obligations by electing to treat their superannuation income stream as a series of lump sum payments. The closure was announced in May 2016 and came into effect as of 1 July 2017.