The Minister for Revenue and Assistant Treasurer, Senator the Hon Helen Coonan, announced today that the Government had paid a financial assistance grant of $812,020 to benefit members of the Australian Independent Superannuation Fund (AISF).

Senator Coonan said that under Part 23 of the Superannuation Industry (Supervision) Act 1993 (the SIS Act) she had made a determination that it was in the public interest to make a grant of assistance to those people who lost money when the fund was defrauded.

Almost 160 fund members suffered losses to their accrued superannuation savings as a result of the fraudulent conduct and theft perpetrated on the Perth-based fund.

"Australians can be reassured that there is legislation and a supporting regulatory framework in place to ensure the security of superannuation savings from this type of loss," Senator Coonan said.

"The SIS Act provides a clear framework for providing financial assistance to superannuation funds that suffer losses due to fraudulent conduct or theft.

"Trustees of regulated superannuation funds are able to apply for assistance if the fund has suffered such an eligible loss, and that loss has caused substantial diminution of the fund leading to difficulties in the payment of benefits."

In this case there was clear evidence of theft with one of the two Directors of the previous trustee (Broadway Fiduciary) currently serving a six-year prison sentence for thefts from the fund.

Several conditions have been placed on the grant of financial assistance, including that the replacement trustee, Denara, continue to pursue options open to it for recovery action against parties that may have attributed to the losses suffered by AISF.

The grant of financial assistance will first be funded out of the Consolidated Revenue Fund, and later recovered by way of a small levy on regulated superannuation funds under the Superannuation (Financial Assistance Funding) Levy Act 1993.