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BFCSA investigates fraud involving lenders, spruikers and financial planners worldwide.  Full Doc, Low Doc, No Doc loans, Lines of Credit and Buffer loans appear to be normal profit making financial products, however, these loans are set to implode within seven years.  For the past two decades, Ms Brailey, President of BFCSA (Inc), has been a tireless campaigner, championing the cause of older and low income people around the Globe who have fallen victim to banking and finance scams.  She has found that people of all ages are being targeted by Bankers offering faulty lending products. BFCSA warn that anyone who has signed up for one of these financial products, is in grave danger of losing their home.

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BFCSA: Suncorp used 'tax surplus' for admin rather than return money to members

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Suncorp used 'tax surplus' for admin rather than return money to members

Sydney Morning Herald 14 August 2018 5:53am

Clancy Yeates

 

Suncorp's superannuation trustee used tax refunds within funds to purchase administrative services from other parts of the financial conglomerate, instead of returning the money to members as many funds do, the royal commission heard.

As part of its scrutiny of superannuation trustees, the Hayne royal commission on Monday afternoon turned its attention to how Suncorp used what it called a "tax surplus."

This referred to member funds that were collected for taxation purposes, but the fund ended up with a surplus because of deductions.

Senior counsel assisting the commission, Michael Hodge QC, questioned Maurizio Pinto, the head of the office of the trustee within Suncorp Portfolio Services Limited (SPSL), about the arrangement, and the monitoring of the services provided.

Mr Hodge said "many" other super funds dealt with a tax surplus such as this by returning it to members, but Suncorp's trustee has been paying the funds to Suncorp Life and Superannuation Limited (SLSL), a life company, since at least 2013.

Mr Pinto confirmed that the tax surplus paid to the life company was $8.1 million in 2012, and the trustee had approved the payment in every year since then.

The payment to the life company was to provide a range of administrative and accounting services, Mr Hodge said, taking Mr Pinto to the contractual agreements.

The life company also covered a range of expenses relating to the fund's expenses, its promotional costs, audit fees, regulator levies and professional costs, Mr Hodge said.

"So can I suggest on the face of this agreement, it would seem to mean Suncorp Life and Superannuation Limited is going to provide all of the administration services and pay all the costs of running the fund in exchange for the tax surplus?" Mr Hodge asked.

"Yes," replied Mr Pinto.

The focus on Suncorp's payments to related parties comes as the commission is putting the role of trustees - who have a responsibility to look after members' interests - under the microscope.

In his opening address ahead of the current round of hearings, last week, Mr Hodge said trustees were "alone in the dark with our money," and suggested there was insufficient regulatory attention given to this part of the $2.6 trillion super sector.

Mr Hodge, who is set to ask further questions of Mr Pinto on Tuesday, asked Mr Pinto about the extent of monitoring of the services provided by the life company.

Mr Pinto replied there was quarterly reporting to the trustee board,  and there was monitoring to make sure the services delivered were satisfactory.

Mr Pinto said SPSL provided administrative services to 75 per cent of its membership, and 25 per cent were provided by SLSL.

But previously, before a "rebalancing," the life company (SLSL) had provided administration services to 45 per cent of the fund, with the trustee administering the remaining 55 per cent of members.

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