Australian Securities & Investments Commission (ASIC) Filed Lawsuit Against Australia Largest Superannuation Fund $225 Billion AustralianSuper for Failure to Process Death Benefit Claims Efficiently, Honestly & Fairly, Took Between 4 Months to 4 Years in at Least 6,897 Cases, 1 Case Took 3.1 Years (1,140 Days) to Make Payment
17th March 2025 | Hong Kong
The Australian Securities & Investments Commission (ASIC) has filed a lawsuit against Australia largest superannuation fund AustralianSuper ($225 billion AUM) for failure to process death benefit claims efficiently, honestly & fairly, taking between 4 months to 4 years in at least 6,897 cases to process the claims with 1 case taking 3.1 years (1,140 days) to make payment. ASIC (13/3/25): “ASIC is suing AustralianSuper Pty Ltd, the trustee of Australia’s largest superannuation fund, over delayed processing of nearly 7,000 death benefit claims, according to proceedings filed in the Federal Court. ASIC alleges between 1 July 2019 and 18 October 2024, AustralianSuper failed to process death benefit claims efficiently, honestly and fairly when it took between four months and four years from the date the claim form was returned to assess at least 6,897 death benefit claims. ASIC also alleges AustralianSuper failed to pay member’s benefits as soon as practicable after the member’s death in respect of at least 752 members. In one case, despite having all the information required to pay the benefit, it took AustralianSuper 1,140 days to make the payment; others took 438, 412 and 366 days. In 254 cases, AustralianSuper took between 15 to 213 days to provide the claim form, according to ASIC’s allegations. Background – AustralianSuper is the trustee of the largest superannuation fund in Australia and manages over $355 billion of retirement savings on behalf of over 3.49 million members (according to APRA as at 30 September 2024). AustralianSuper was responsible for nearly a quarter of all complaints to the Australian Financial Complaints Authority (AFCA) about death benefits in 2022/23 and 2023/24. From 2021 to 2023, AFCA complaints about service-related issues relating to superannuation products roughly doubled. On 21 February 2025, the Federal Court of Australia ordered that AustralianSuper pay a pecuniary penalty of $27 million in respect of failures to merge multiple member accounts (25-017MR).” In 2025 February, the Australian Securities & Investments Commission (ASIC) has fined Australia largest superannuation fund AustralianSuper ($225 billion AUM) $17.1 million (AUD 27 million) for failing to merge 90,700 members with multiple accounts from 2013 to 2023 resulting in $43.8 million (AUD 69 million) losses incurred from administration fees, insurance premiums & lost investment earnings.
“ Australian Securities & Investments Commission (ASIC) Filed Lawsuit Against Australia Largest Superannuation Fund $225 Billion AustralianSuper for Failure to Process Death Benefit Claims Efficiently, Honestly & Fairly, Took Between 4 Months to 4 Years in at Least 6,897 Cases, 1 Case Took 3.1 Years (1,140 Days) to Make Payment “
Australian Securities & Investments Commission (ASIC) Fines Australia Largest Superannuation Fund AustralianSuper $17.1 Million for Failing to Merge 90,700 Members with Multiple Accounts from 2013 to 2023 Resulting in $43.8 Million Losses Incurred from Administration Fees, Insurance Premiums & Lost Investment Earnings
22nd February 2025 – The Australian Securities & Investments Commission (ASIC) has fined Australia largest superannuation fund AustralianSuper ($225 billion AUM) $17.1 million (AUD 27 million) for failing to merge 90,700 members with multiple accounts from 2013 to 2023 resulting in $43.8 million (AUD 69 million) losses incurred from administration fees, insurance premiums & lost investment earnings. ASIC (21/2/25): “AustralianSuper, the trustee of Australia’s largest superannuation fund, will pay a $27 million penalty after the Federal Court today found that it failed to merge multiple member accounts. The Court held this to be a breach of the fundamental duties and obligations AustralianSuper owed to its members, and that it was inexcusable for Australian Super not to have had the processes and systems in place to ensure compliance. In the period 1 July 2013 until 31 March 2023, approximately 90,700 AustralianSuper members had multiple accounts that should have been merged. These members incurred approximately $69 million in losses through multiple administration fees, insurance premiums and lost investment earnings. All affected members have been remediated … … This was the first case that ASIC has brought in its capacity as a co-regulator with APRA alleging contraventions of section 52 of the Superannuation Industry (Supervision) Act 1993 (Cth). ASIC’s Moneysmart website has information about how to consolidate super accounts. One of ASIC’s enforcement priorities is member services failures in the superannuation sector. In separate proceedings, ASIC has alleged more than 10,000 members and claimants of CBus were impacted by delays to death benefits and total and permanent disability insurance claims.” Background – Unintended multiple superannuation accounts are a significant issue for Australian consumers. ATO data shows that as at 30 June 2024, around four million people had two or more superannuation accounts. AustralianSuper is Australia’s largest super fund, with over 3.5 million members and $365 billion in member assets. AustralianSuper has remediated members who held multiple accounts within the fund at and from 30 June 2014, for the period 1 July 2014 to 31 March 2023. In December 2021, AustralianSuper reported to ASIC a potential failure to comply with their obligations to consolidate duplicate accounts. AustralianSuper was then subsequently included in ASIC’s broader review of trustee practices. ASIC published the findings from this review in June 2023, when we called on superannuation trustees to review their policies and procedures regarding duplicate members accounts, after the review identified poor practices resulting in consumer harm (23-175MR). ASIC filed civil proceedings in the Federal Court at the conclusion of its investigation on 8 September 2023 (23-249MR).
Justice Hespe: “AustralianSuper’s failures to comply with s 108A for almost nine years after the section came into effect, to identify its non-compliance and to take steps to remedy that non-compliance were systemic failings and as explained above, were the result of failing to have appropriate systems and processes in place. The failures should not have happened. The failures are serious and highly concerning … … It is inexcusable for [AustralianSuper] to not have had processes and systems in place to ensure compliance with a specific legislative requirement… Its systems also failed to ensure that repeated human errors in relation to the failure to merge the multiple accounts were prevented or promptly identified and corrected … … Issues were not escalated [within AustralianSuper] and senior management oversight was absent, resulting in the dereliction of a fundamental regulatory obligation intended to further the best interests of members. Under-resourcing and a failure to prioritise compliance with s 108A of the SIS Act resulted in unacceptable delays … … Some of the internal correspondence… suggested that some within AustralianSuper lost sight of the fact that AustralianSuper was required to act in the best interests of individual members when considering the merger of multiple accounts, rather than seeking to hold on to as many accounts as possible. Such correspondence is demonstrative of a lack of appreciation of the gravity of the conduct and a fundamental lack of understanding of the obligations and duties of AustralianSuper.”
ASIC Deputy Chair Sarah Court: “This penalty reflects the severity of the misconduct by Australia’s largest superannuation fund which betrayed the trust of its members and did not act in their best financial interests. This was exacerbated by a systemic failure to escalate and remediate the issue once it was identified. Improving services to superannuation fund members is a strategic priority for ASIC and we will continue to take strong action where we consider that members are not getting the service they deserve from their superannuation trustees.”
Background – Unintended multiple superannuation accounts are a significant issue for Australian consumers. ATO data shows that as at 30 June 2024, around four million people had two or more superannuation accounts. AustralianSuper is Australia’s largest super fund, with over 3.5 million members and $365 billion in member assets. AustralianSuper has remediated members who held multiple accounts within the fund at and from 30 June 2014, for the period 1 July 2014 to 31 March 2023. In December 2021, AustralianSuper reported to ASIC a potential failure to comply with their obligations to consolidate duplicate accounts. AustralianSuper was then subsequently included in ASIC’s broader review of trustee practices. ASIC published the findings from this review in June 2023, when we called on superannuation trustees to review their policies and procedures regarding duplicate members accounts, after the review identified poor practices resulting in consumer harm (23-175MR). ASIC filed civil proceedings in the Federal Court at the conclusion of its investigation on 8 September 2023 (23-249MR).
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