ASIC's actions against Financial Planners have made the headlines recently (August 2014) and property scheme disasters are on ASIC's radar due to epic failures (July 2014). Now the latest breed of property development schemes may soon be surfacing as a new trouble spot. SMSF Property Development Fund managers will be subjected to more scrutiny. Risks are usually disclosed in a PDS. But few SMSF Fund managers are aware of some less well known risks that I would describe as a SMSF disaster that has been waiting to happen.
To make a long story short Competence Issues, Power struggles and Litigation can completely wipe out all investment capital in a SMSF Property Development Super Fund. To make things worse all this has happen under the watchful eye of ASIC without decisive intervention. SMSF investors have very little control over the activities of their fund managers. The only way out is replacement which requires 51 % of the investors vote. ASIC policy regulates that complainants will not be informed whether or not an investigation will be launched. ASIC will however publicly report enforcement actions in the event that any investigations proceed to that point.
ASIC NEWS - extracted from an article in the Australian.
The corporate regulator has warned there remain widespread shortcomings in the financial planning industry. Actions where taken against Macquarie, Wealth manager AMP, investment bank UBS and CBA and warnings by ASIC have led to the Future of Financial Advice reforms. “This is an industry that has to lift its game,’’ ASIC commissioner Peter Kell said. “They need to put the customer first.” ASIC imposed an enforceable undertaking in January 2013. But in May a parliamentary committee called for a royal commission.
To make a long story short Competence Issues, Power struggles and Litigation can completely wipe out all investment capital in a SMSF Property Development Super Fund. To make things worse all this has happen under the watchful eye of ASIC without decisive intervention. SMSF investors have very little control over the activities of their fund managers. The only way out is replacement which requires 51 % of the investors vote. ASIC policy regulates that complainants will not be informed whether or not an investigation will be launched. ASIC will however publicly report enforcement actions in the event that any investigations proceed to that point.
ASIC NEWS - extracted from an article in the Australian.
The corporate regulator has warned there remain widespread shortcomings in the financial planning industry. Actions where taken against Macquarie, Wealth manager AMP, investment bank UBS and CBA and warnings by ASIC have led to the Future of Financial Advice reforms. “This is an industry that has to lift its game,’’ ASIC commissioner Peter Kell said. “They need to put the customer first.” ASIC imposed an enforceable undertaking in January 2013. But in May a parliamentary committee called for a royal commission.
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