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APRA disqualifies trustee directors of Australian Enterprise Superannuation Fund

30 Nov 2005
05.59

The Australian Prudential Regulation Authority (APRA) today announced the disqualifications of Mr Ian Baldock, Mr Kerry Woolacott and Mr Michael McGarry from acting as trustees, investment managers or custodians of a superannuation entity or responsible officers of a body corporate that is a trustee, investment manager or custodian of a superannuation entity.

All three are former directors of Australian Enterprise Superannuation Pty Ltd (the Trustee), which is the corporate trustee of the Australian Enterprise Superannuation Fund (the Fund). The Fund manages around $73.27 million of assets on behalf of 18,891 members, many of whom are casual workers with low account balances.

APRA found that Mr Baldock, Mr Woolacott and Mr McGarry each failed to exercise the necessary degree of care and diligence to ensure that the Trustee exercised its duties and powers in the best interests of beneficiaries, as it was required to do under the Superannuation Industry (Supervision) Act 1993.

In particular, APRA found that the three former trustee directors had failed to appropriately manage conflicts of interest and to ensure that the fees charged as a result of lost and low-balance members were not excessive in the circumstances.

In announcing the disqualifications, APRA’s Deputy Chairman, Mr Ross Jones, said that APRA’s primary concern was ensuring that the interests of members of superannuation funds were protected, including funds catering to casual workers with small accrued entitlements.

The disqualifications follow an APRA investigation into the affairs of the Fund which commenced in February 2004. As the investigation is continuing, APRA will make no further comment about it at this point.

The Australian Prudential Regulation Authority (APRA) is the prudential regulator of the financial services industry. It oversees banks, credit unions, building societies, general insurance and reinsurance companies, life insurance, friendly societies, and most members of the superannuation industry. APRA is funded largely by the industries that it supervises. It was established on 1 July 1998. APRA currently supervises institutions holding approximately $2.2 trillion in assets for 20 million Australian depositors, policyholders and superannuation fund members.