Fund Regulatory Update

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CFS facing class action over claims of losses

A class action against Colonial First State is set to start with hearings in April 2022. Mediation has been set for late March, with a case management hearing in mid-February. If mediation fails, a three-week hearing will commence in April.

Law firm Maurice Blackburn filed the case, alleging that CFS’s slow implementation of MySuper reforms for members of its FirstChoice Employer Super from 2013-2017 resulted in “substantial losses” to over 100,000 members.

CFS is accused of failing to exercise “the degree of care, skill and diligence required of a prudent superannuation trustee”, and failing to take care of the best interests of its members. It is alleged that members should have been transferred into a MySuper product earlier than they were.

APRA’s policy and supervision priorities for 2022

The Australian Prudential Regulation Authority (APRA) has updated the industry with its regulatory priorities for the coming 12-18 months, with two themes: protected today and prepared for tomorrow. The most recent priorities include an emphasis on new and emerging financial risks, practices and business models that are stretching traditional models.

Priorities also include:

  • Crisis preparedness

  • Bank capital reform implementation

  • Strengthening superannuation

  • Complete insurance reforms

  • Work on the proposed Financial Accountability Regime

  • Supervision priorities such as industry practices and cyber risk preparedness

Download APRA Policy Priorities and Supervision Priorities documents

Mayfair 101 appeals

Mayfair 101 has confirmed it will appear the 2021 Federal Court decision that found its advertising material misled and deceived investors. Mayfair was fined $30 million. Mayfair says the court has made an error in its decision and has requested that the matter be dismissed.

ASIC to overhaul ET product names

The Australian Securities and Investments Commission (ASIC) may overhaul the naming conventions of exchange-traded products, saying these products have differing structures, features, strategies and risks when compared to listed investment companies, trusts and warrants, and should be labelled differently to other listed products.

ASIC wants market operators and issuers to consider two levels of labelling: primary labels for product type, then secondary labels for specific risks or strategies. ASIC has released a consultation paper (356) and is seeking feedback until March 3.