Colonial First State fined $20m for misleading super members


Colonial First State hit with $20 million fine for misleading customers, and a senate inquiry backs the crypto industry.

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Telemarketer hit with $100,000 fine for unlawful calls

crypto senate inquiry

Information Support Australia Pty Ltd (trading as Super Information Team) has been slapped with a $102,120 fine by the Australian Communications and Media Authority (ACMA) for making 880 calls to phone numbers on the do not call register in October 2020.

The calls were made by a third-party call centre and offered recipients a review of their superannuation and to connect them with a financial advisor.

ACMA chair Nerida O'Loughlin said unlawful financial services marketing is an ACMA compliance priority given the potential for harm involved, especially at a time when many Australians have been experiencing financial difficulties due to COVID restrictions.

"Unwanted telemarketing causes frustration and anxiety, and the Do Not Call Register is your phone's equivalent of a 'No junk mail' sticker on your letterbox," she says.

"The size of this infringement notice sends a message to telemarketers that we will not hesitate to take action against those that break the rules."

Senate inquiry backs crypto industry

A Senate inquiry into digital payments has just recommended changes to taxation laws, licensing, and regulatory regimes that encourage crypto-asset businesses to set up in Australia.

"With the committee recommending things like capital requirements and auditing, it will help protect consumers and strengthen exchanges like Cointree. It's clearly a sign that the industry is maturing," says Cointree CEO Shane Stevenson.

"If these new regulations are implemented, it will allow larger institutions like pension funds to enter the space with more significant mandates. If these institutions allocate even a small percentage of their portfolio towards crypto, it will likely drive crypto prices much higher."

One of the key recommendations from the inquiry is the introduction of a market licencing regime for crypto exchanges.

"The introduction of a formal licencing regime is a big step in shifting the mindset of Australia's investment community away from viewing cryptocurrency as a speculative investment trend, and toward viewing it as a legitimate asset class with a broad role in modern portfolios," says Stevenson.

"Most of Australia's exchanges and funds operate with access to a licencing regime which aims to hold an industry to a professional standard and weed out any undesirable players in the space, and this will be the same for crypto. Legitimate exchanges and traders will benefit from this development."

Colonial First State fined $20 million for misleading super members

The Federal Court has ordered Colonial First State to pay a $20 million penalty for misleading its members.

The Federal Court fine comes after the company was found to have breached the Corporations Act for misleading its members on at least 12,978 occasions when it incorrectly informed them that legislative changes required Colonial to contact them and obtain an investment direction to stay in the FirstChoice Fund, and for failing to tell members that if Colonial did not receive an investment direction from the member, it was required to transfer the member's superannuation contributions into a MySuper product.

"The $20 million penalty handed down to Colonial is a timely reminder to superannuation trustees not to mislead members for their own benefit," says Australian Securities and Investment Commission deputy chair Sarah Court.

"Trustees have an obligation to provide their members with balanced and accurate information that enables them to make informed decisions about their retirement savings."

Slater and Gordon considers class action against Star Entertainment Group

Law firm Slater and Gordon is weighing up whether to bring a class action against Star Entertainment Group on behalf of its investors, following revelations the Casino giant may have enabled money laundering, organised crime, large-scale fraud and foreign interference.

Slater and Gordon is now assessing whether shareholders suffered capital losses as a result of materially incorrect information being available to the market.

"We consider that the information released may give rise to a claim on behalf of shareholders against the company," says class actions practice group leader Emma Pelka-Caven.

"At the time they purchase shares in a listed company, investors are entitled to assume that all of the material information relevant to its financial position has been disclosed."

Zip inks agreement to bring BNPL to childcare

Buy now, pay later payment platform Zip has signed a deal with Xplor Technologies to offer families more choice and flexibility when it comes to paying for childcare services.

Families attending care at Australian childcare centres that use Xplor's childcare payment services would be able to spread the cost of paying for childcare over time.

"We are excited to venture into the buy now, pay later ecosystem with Zip, to be able to offer people more flexibility with how they pay for childcare," says the CEO of Xplor Education, Mark Woodland.

"We know there is demand for tailored payment options in the Australian market, and believe this innovative initiative will improve access to childcare for more families."

Zip will be available to Xplor's network of childcare centres from early November, when families will be able to access the service directly from their childcare centre's mobile app.

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David Thornton was a journalist at Money from September 2019 to November 2021. He previously worked at Your Money, covering market news as producer of Trading Day Live. Before that, he covered business and finance news at The Constant Investor. David holds a Masters of International Relations from the University of Melbourne.