FUND MANAGEMENT – FEES – AUSTRALIA

NAB hit with class action on super rip-off

roymorgansocial Leave a comment

Original article by Aleks Vickovich
The Australian Financial Review – Page: 12 & 17 : 22-Jan-20

A class action lawsuit will contend that National Australia Bank’s superannuation customers incurred substantial losses due to the bank’s tardiness in shifting them to a MySuper product. Law firm Maurice Blackburn will argue that NAB subsidiaries MLC Nominees and NULIS Nominees breached their duties as superannuation trustees by keeping customers in funds that had higher fees than MySuper products. The allegations were first raised before the Hayne royal commission in 2018.

CORPORATES
NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, MAURICE BLACKBURN PTY LTD, MLC NOMINEES, NULIS NOMINEES (AUSTRALIA) LIMITED, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY

Multiple super accounts cost $2.6bn a year

roymorgansocial Leave a comment

Original article by Michael Roddan
The Australian – Page: 7 : 25-Oct-19

Superannuation fund members pay a combined $32bn in fees each year, including some $2.6bn in fees on lost and forgotten super accounts. Data from the Australian Taxation Office highlights the issue of multiple super accounts; some 23 per cent of the nation’s 16 million workers have two super accounts, while eight per cent have three and one per cent have six or more super accounts. The ATO also notes that more Australians have opted to consolidate their super accounts over the last five years.

CORPORATES
AUSTRALIAN TAXATION OFFICE, AUSTRALIA. PRODUCTIVITY COMMISSION, AUSTRALIAN LABOR PARTY

Super fees twice as high for under 35s

roymorgansocial Leave a comment

Original article by Michael Roddan
The Australian – Page: 6 : 10-Oct-19

Rainmaker Information Services has released a report which shows that workers who are under the age of 35 pay an average fee of 2.3 per cent, compared with just 1.2 per cent for those aged 35+. The report also contends that male workers pay an average of 1.1 per cent in super fees, compared with 1.3 per cent for female workers. Alex Dunnin of Rainmaker stresses that super funds are not overcharging or ripping members off; rather, the super industry has not been designed with young workers and those with low balances in mind.

CORPORATES
RAINMAKER INFORMATION SERVICES PTY LTD, AUSTRALIA. DEPT OF FINANCE

Super fee gap shrinking as retail funds catch up

roymorgansocial Leave a comment

Original article by Joanna Mather
The Australian Financial Review – Page: 3 : 9-Oct-19

Data from Rainmaker shows that the superannuation industry’s fees fell by about four per cent in 2018-19, to $31.8bn. It was the first decline in fees since 2014, with retail super funds recording the biggest fall. Rainmaker notes that as a result, the traditional fee gap between retail and industry super funds has narrowed to almost zero. This is particularly so in the case of MySuper funds; the average fee for non-profit MySuper products is now 1.15 per cent, compared with an average of 1.17 per cent for retail MySuper products.

CORPORATES
RAINMAKER INFORMATION SERVICES PTY LTD

AMP hit with new class action

roymorgansocial Leave a comment

Original article by Samantha Bailey
The Australian – Page: 20 : 27-Jun-19

AMP says it will "vigorously" defend a class action launched by law firm Slater & Gordon, which alleges that superannuation fund members were charged excessive fees. Slater & Gordon is the second law firm to file a class action on behalf of AMP’s super fund members, with Maurice Blackburn having done so in May. Maurice Blackburn is also pursuing a separate class action against AMP over its compliance with disclosure obligations.

CORPORATES
AMP LIMITED – ASX AMP, SLATER AND GORDON LIMITED – ASX SGH, MAURICE BLACKBURN PTY LTD, THERIUM LITIGATION FINANCE

Super system far too complex

roymorgansocial Leave a comment

Original article by Adam Creighton
The Australian – Page: 17 & 20 : 24-Jun-19

Nobel Prize-winning economists Eugene Fama and Richard Thaler contend that Australia’s superannuation system has too many investment options and that its fees are too high. Fama says low-fee passive funds should be the default option in a system that is government-mandated, while Thaler says lower fees should be achievable through competitive bidding. Treasurer Josh Frydenberg recently announced a new review of the $2.8 trillion superannuation sector.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, AUSTRALIA. PRODUCTIVITY COMMISSION, RAINMAKER INFORMATION SERVICES PTY LTD

AMP reaps $100m in zombie fees

roymorgansocial Leave a comment

Original article by Michael Roddan
The Australian – Page: 6 : 1-Feb-19

The federal government’s legislative agenda for February will include a bill to enable the Australian Taxation Office to transfer monies from inactive superannuation accounts with low balances to the fund member. There are about 7.3 million inactive super accounts in Australia, and it is estimated that AMP alone generates at least $100m in fees each year from more than one million such accounts. Australians also pay some $2.6bn a year in fees for multiple super accounts.

CORPORATES
AMP LIMITED – ASX AMP, AUSTRALIAN TAXATION OFFICE, AUSTRALIAN LABOR PARTY, AUSTRALIANSUPER PTY LTD, MOTOR TRADES ASSOCIATION OF AUSTRALIA SUPERANNUATION FUND PTY LTD, REST SUPER PTY LTD, FIRST SUPER PTY LTD, AUSTRALIA. PRODUCTIVITY COMMISSION, AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY

Super mergers could save $1.8bn

roymorgansocial Leave a comment

Original article by Michael Roddan
The Australian – Page: 17 & 24 : 26-Nov-18

The Productivity Commission claims that $1.8 billion in savings could be gained each year if Australia’s 50 highest-cost superannuation funds were forced to merge with the 10 lowest-cost funds. The Commission’s research indicates that around eight per cent of all superannuation accounts are "trapped" in funds that have high fees and generally underperform, while there are 93 funds with less than $1 billion in assets. Its figures come as the banking royal commission prepares to take the Australian Prudential Regulation Authority to task over its tardy oversight of the superannuation sector.

CORPORATES
AUSTRALIA. PRODUCTIVITY COMMISSION, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AMP LIMITED – ASX AMP, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY

NAB charges double on super

roymorgansocial Leave a comment

Original article by Elizabeth Redman
The Australian – Page: 17 & 20 : 20-Aug-18

The banking royal commission has spent the last two weeks grilling the superannuation sector over its fees and practices. Companies under the commission’s microscope have included National Australia Bank, with Australian Securities & Investments Commission deputy chairman Peter Kels stating that it planned to submit a brief to the Director of Public Prosecutions in regard to NAB’s "fee for no service" scandal. Meanwhile, it has been revealed that NAB unit MLC charges members of at least 10 super funds up to double the fees that are imposed by the fund’s external managers.

CORPORATES
AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, MLC LIMITED, THE VANGUARD GROUP INCORPORATED, MACQUARIE GROUP LIMITED – ASX MQG, PERPETUAL LIMITED – ASX PPT, PACIFIC INVESTMENT MANAGEMENT COMPANY LLC

NAB’s fee strategy in spotlight

roymorgansocial Leave a comment

Original article by Joanna Mather
The Australian Financial Review – Page: 8 : 7-Aug-18

The banking royal commission has been told that National Australia Bank retained "grandfathered" commissions after merging five separate superannuation funds in 2016. A former NAB executive, Paul Carter, told the inquiry that the bank had been concerned about the impact that abolishing the commissions would have on revenue, as financial planners could potentially have responded to the move by directing clients to other products. The inquiry was also told that NAB failed to inform clients that they could opt out of paying a "plan service fee".

CORPORATES
NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, MLC LIMITED, MLC MASTERKEY, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, NULIS