Past performance is no indicator of future performance, superannuation funds tell their members, but recent incidents have raised questions about their previous returns.
Two of Australia’s largest super funds with about 2.5 million members combined have been fined for publishing out-of-date information about their financial track record.
Australia’s second largest fund Australian Retirement Trust (ART) has paid $18,780 (US$12,020) to comply with an infringement notice issued by Australian Securities & Investments Commission (ASIC) over allegedly misleading performance data.
Between July 2023 and July 2024 ART, which manages more than $330 billion for 2.4 million members, published out-of-date data about the performance of its default MySuper product, the Lifecycle Investment Strategy, ASIC said.
From 18 July 2023, ART’s 2023 Super Savings Product Dashboard incorrectly showed figures for the financial year ending June 2022, which were higher than the figures for the financial year ending June 2023.
“ASIC issued this infringement notice because we were worried that the outdated data published on ART’s website could lead consumers to believe that the Lifecycle Investment Strategy’s performance was better than it truly was,” ASIC Deputy Chair Sarah Court said in a media release.
“Superannuation is the largest asset of many Australians outside their family home.
“This notice is a reminder that it is imperative that Australian consumers are given accurate information to assess fund performance, especially in circumstances where they might be considering switching funds.”
ASIC said payment of an infringement notice was not an admission of liability.
The first super fund to be fined for incorrect performance data was HESTA, which manages $93 billion for 1.05 million Australians.
In November 2023 HESTA paid $48,000 to comply with three infringement notices related to allegedly misleading statements relating to the 10-year performance of its Balanced Growth investment option (23-299MR).
The fines are small change for these funds, representing just 0.02% of their combined funds under management.
