Superannuation trustees are on notice to improve their internal dispute resolution systems after a targeted review of trustee compliance with the enforceable complaints handling requirements, according to the corporate regulator.

The review found that some trustees had sub-standard arrangements for managing complaints.

Most trustees failed to inform consumers when their response to the complaints exceeded the maximum timeframe. This could delay consumers exercising their right to go to the AFCA 

Trustees’ failure to comply with obligations can lead to poor outcomes, such as consumers abandoning a complaint. 

ASIC will write to these trustees about complying with complaints handling requirements. The trustees will be required to take prompt action to remedy the issues identified, and the majority will need to report on improvements made. 

ASIC is also considering other regulatory actions where necessary. 

Key concerns outlined by ASIC: 

  • RG 271 sets a maximum timeframe of 45 days (with limited exceptions) to issue a written response for complaints about superannuation that are not an objection to the distribution of a death benefit. ASIC’s review found a number of trustees did not respond to a significant portion of their complaints in a timely manner;
  • Most trustees failed to ensure all complainants were kept informed when their response to the complaints exceeded the maximum timeframe. This could delay complainants exercising their right to go to AFCA; 
  • Too many written responses to complaints omitted mandatory content related to a consumer’s right to take their complaint to AFCA; 
  • There were gaps in how most trustees managed systemic issues that could be identified through member complaints or how they used intelligence from complaints to improve their products and services. ASIC consider this a missed opportunity for trustees to detect and address issues that impact their wider membership, thereby improving their business and minimising future problems; and 
  • Trustees’ internal reporting often lacked sufficient detail to identify, much less remedy, deficiencies in complaint handling.