ASIC has taken legal action against Mercer Super, accusing the fund of failing to comply with reporting obligations. The regulator alleges that Mercer Super did not promptly report investigations into breaches of core obligations as required by the reportable situations regime. According to ASIC, Mercer Super was late in reporting one investigation and failed to report seven others. These investigations included issues such as incorrect insurance premium refunds, missing member accounts with default insurance, and unprocessed member information updates.
ASIC Deputy Chair Sarah Court stated that Mercer Super’s alleged failures were not merely technical breaches but demonstrated a lack of customer care and risked putting members at further disadvantage. The regulator also accused Mercer Super of providing inaccurate information to ASIC, downplaying the impact on affected members.
In response, a spokesperson for Mercer Super acknowledged ASIC’s action and mentioned that the fund was reviewing the claim. The spokesperson clarified that the matter pertained to breach reporting obligations introduced by ASIC, emphasizing that there was no deliberate intention to mislead the regulator.
This legal action against Mercer Super is part of a broader trend of regulatory scrutiny on superannuation funds regarding member services. In the past year, ASIC has taken both Cbus and AustralianSuper to court over alleged mishandling of death benefit and insurance claims. Court emphasized that super funds like Mercer Super should have robust systems in place to address critical issues and comply with reporting requirements.
ASIC’s review of claims handling in the superannuation sector earlier this year revealed significant delays and lack of monitoring by trustees in handling death benefit claims. This review prompted ASIC to signal more enforcement actions in the future if similar deficiencies persist. ASIC Commissioner Simone Constant stressed the importance of funds not taking their members for granted and highlighted the increasing significance of service provision alongside accumulation in the superannuation industry.
The legal action against Mercer Super underscores the regulator’s commitment to early identification of misconduct to protect consumers. With the reportable situations regime in place to ensure timely reporting of breaches, ASIC aims to hold super funds accountable for compliance with the law and safeguarding members’ interests.
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