The Australian Securities and Investments Commission (ASIC) has engaged with super trustees to ensure efforts are being made to consolidate duplicate member accounts following a review that found “troubling” practices from observed groups.   

The ASIC review examined steps taken by nine trustees, which covered both retail and industry funds, to fulfil their obligations to identify and combine duplicate accounts to minimise customer payments of unnecessary fees.  

The regulator found that three of the trustees did not have a documented process that outlined how to merge accounts, while others held rules that excluded specific cohorts of customers from the matching process.  

The review, which was also engaged by the Australian Prudential Regulation Authority, noted that only three trustees held a system to check for existing accounts on account creation but found that most did communicate with members to inform them about uncovered duplicate accounts.  

ASIC Commissioner Danielle Press says duplicate accounts can “significantly erode” a customer’s super balance over time with fees, such as insurance premiums, incorrectly being paid multiple times.   

“Trustees should be proactively merging duplicate member accounts within the fund to not only help their members avoid extra fees but also to ensure their funds avoid costly remediation in the future,” Ms Press said. “However, our review highlighted that they are not doing enough.”  

The regulator says it has engaged with the reviewed groups to ensure they hold documented processes to identify and prevent multiple super accounts, with commitments made to reimburse affected members.   

But Ms Press warns that despite agreed compensation, the review’s findings represent worrying industry failures.   

“It shouldn’t take an ASIC review for super trustees to comply with the law,” Ms Press said.  

“We are concerned about some of the failures uncovered in our review and are considering other regulatory action for more serious concerns.”  

According to data from the ATO from last June, over three million Australians were found to hold two or more superannuation accounts, including some within the same fund.