APRA has chosen not to appeal the Federal Court decision to dismiss its court action against IOOF, which alleged the wealth giant had failed to act in the best interests of its superannuation members.
The judgement on 20 September found IOOF had not contravened its obligations under the Superannuation Industry Supervision Act 1993 (SIS Act).
At the time, APRA expressed disappointment, but deputy chair Helen Rowell said the case had examined a range of legal questions that had not previously been tested in court, such as the management of conflicts of interest, the appropriate use of super funds’ general reserves and the need to put members’ interests above any competing priorities.
The regulator initiated the action in December due to its view that IOOF entities, directors and executives had failed to act in the best interests of their super members.
Before filing the claim, APRA said it had sought to solve concerns with IOOF over a number of years but considered it necessary to take stronger action after concluding the company was not making adequate process.
Ms Rowell said the judgement nevertheless raised some issues of wider importance for the regulator in its supervision of super trustees.
The watchdog indicated it is considering reshaping its super supervision to ensure maximum protection of members, through actions such as revising prudential standards or seeking legislative amendments.
However, additional license conditions that APRA imposed on IOOF in December remain in force, unaffected by the judgement, with the regulator closely monitoring the group’s compliance.
Sarah Simpkins is a journalist at Momentum Media, reporting primarily on banking, financial services and wealth.
Prior to joining the team in 2018, Sarah worked in trade media and produced stories for a current affairs program on community radio.
You can contact her on [email protected].
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