Illegal early super release promoters to face penalties

The Minister for Superannuation has announced that the Government will introduce penalties to deter promoters of illegal early release superannuation schemes. Mr Shorten said these promoters have in the past exploited vulnerable people by encouraging applications for rollover of superannuation balances. In these situations, he said the promoters have taken fees of up to 50% of the member’s superannuation balance.

Mr Shorten said promoters of these schemes generally target non-English speaking communities and take advantage of those who may not be fully aware of the rules regarding access to superannuation benefits. According to Mr Shorten, some schemes have facilitated up to $8 million in illegal release of superannuation benefits and generated millions in commissions for promoters. In some cases, promoters have gone further and exploited identity data for other criminal purposes or actually stolen the entire balance.

The Minister said legislation giving effect to the penalties is being progressed and will take effect when Royal Assent is received.

Source: Minister for Superannuation’s press release No 044, 13 July 2012 http://ministers.treasury.gov.au/DisplayDocs.aspx?doc=pressreleases/2012/044.htm&pageID=003&min=brs&Year=&DocType=