As the industry prepares for workers to have the right to choose where their compulsory superannuation payments will be invested from July 1, the regulators are issuing words of caution.

The Australian Securities and Investments Commission says it will use undercover officers to expose illegal selling of retirement savings products as the new super laws are introduced.

The regulator says the move comes as the number of applications to become licensed financial advisers increases, and the standard of applications declines.

Meanwhile, Australian Prudential Regulation Authority Deputy Chairman Ross Jones says some fund members are already being given too much choice.

In an article titled “Too much of a good thing”, he warned fund trustees to stay within the APRA guidelines and to ensure a member’s super assets are diversified, with an acceptable trade-off between risk and expected return.