ASIC commences civil penalty proceedings against Statewide Superannuation

The Australian Securities and Investment Commission (ASIC) has commenced proceedings in the Federal Court against Statewide Superannuation Pty Ltd (Statewide), for false or misleading representations made about the insurance cover held by members of the Statewide Superannuation Trust (Fund). Statewide is the trustee of the Fund.

The company regulator alleges that from May 2017 to June 2020, Statewide:

• sent annual statements and warning letters to approximately 12,500 Fund members, representing they held insurance cover at a time when those members did not have cover under a Statewide insurance policy; and
• deducted monthly insurance premiums (worth a total of approximately $1,500,000) from superannuation accounts of certain Fund members when those members did not have cover under a Statewide insurance policy.

ASIC added that in making these representations, Statewide breached its obligations as an Australian financial services licence holder to act efficiently, honestly and fairly and to comply with the financial services laws. Statewide also failed in its breach reporting obligation to report these breaches to ASIC within 10 business days.

ASIC is seeking declarations, pecuniary penalties, injunctions relating to a remediation program and publication orders. The date for the first case management hearing is yet to be scheduled by the Court.