The Acting Minister for Financial Services and Regulation, Senator Hon Rod Kemp, yesterday announced that he had given consent for the Australian Prudential Regulation Authority (APRA) to revoke the approval of Commercial Nominees of Australia Ltd as an approved trustee for the purposes of the Superannuation Industry (Supervision) Act 1993 and to remove Commercial Nominees of Australia Ltd as trustee of some 500 small APRA superannuation funds.

Last year APRA appointed an independent financial investigator, Pricewaterhouse Coopers, to three superannuation funds and they reported to APRA in November 2000. As a result of that investigation, APRA replaced Commercial Nominees of Australia as trustee of the Australian Workforce Eligible Rollover Fund, Midas/Miden Group Superannuation Fund and Network Superannuation Fund in December 2000.

These superannuation funds were found to have significant exposures to impaired assets through two unit trusts. The unit trusts were found to be illiquid. APRA's investigations have also revealed significant exposures to these impaired assets by many of the small superannuation funds of which Commercial Nominees of Australia Ltd was the approved trustee. APRA moved to revoke the approval of Commercial Nominees of Australia Ltd as an approved trustee. That approval was revoked today.

As a result of that revocation, APRA replaced Commercial Nominees of Australia Ltd as trustee of some 500 small APRA funds.

APRA has been working closely with ASIC in its investigations into the affairs of Commercial Nominees of Australia Ltd and will continue to do so.

For further information:
Gloria Peterson
Public Affairs Manager
02 9210 3385