The Self-Managed Super Fund Professionals’ Association (SPAA) has encouraged debate on the issue of financial loss due to fraud or theft, saying its impact is not limited to superannuation but all Australian investors.
At its Technical Conference in Sydney today, the SPAA said broader reforms are required around insurance and compensation measures for the financial advice industry.
Responding to the Parliamentary Joint Committee inquiry into the collapse of Trio Capital, SPAA believes a similar last resort compensation scheme which applies to APRA regulated funds on fraud and theft should be made available to all investors irrespective of the financial service or financial product provided.
“This is not just about SMSFs, it’s also about making sure all investors who are doing the right thing have a genuine option of compensation in situations where they suffer a financial loss as a result of fraud or theft,” SPAA chief executive Andrea Slattery said.
“Under the current regime some investors are compensated while others are not, and we don’t believe that’s right.
“We acknowledge that many SMSF investors have made a consensus decision to make their own investment decisions but that should not mean they are left to fend for themselves if they lose money due to the criminal acts committed by someone else,” Ms Slattery said.
SPAA believes it is important that product providers are part of a statutory last resort compensation scheme for the financial services sector.