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APRA releases draft prudential practice guide on superannuation fraud risk management

Monday 27 October 2014

 

14.20

The Australian Prudential Regulation Authority (APRA) today released for consultation a draft prudential practice guide that provides guidance on good practices for Registrable Superannuation Entity (RSE) licensees in relation to fraud risk management.

As part of the new superannuation prudential framework supporting the Government’s Stronger Super Reforms, APRA introduced Prudential Standard SPS 220 Risk Management (SPS 220) in late 2012. Prudential Practice Guide SPG 220 Risk Management was subsequently released in 2013 to support the requirements set out in SPS 220.

At that time, APRA foreshadowed it would update its existing guidance notes on the management of superannuation fraud risk: How to Reduce the Risk of Fraud - A Best Practice Guide for Trustees and Superannuation Fraud Checklist for Trustees, through the issue of a prudential practice guide. This aligns with APRA’s risk-based approach of providing up-to-date and practical guidance on matters that APRA-regulated entities may consider relevant in meeting the requirements of the prudential standards.

Draft Prudential Practice Guide SPG 223 Fraud Risk Management (SPG 223) outlines prudent practices in relation to the management of fraud risk, and focuses on current and emerging fraud risk factors impacting the superannuation industry from both an internal and external perspective.

APRA Member Helen Rowell said ‘APRA remains focussed on improving risk management practices across the superannuation industry, including fraud risk management. Draft SPG 223 substantially updates and expands upon APRA’s existing fraud risk guidance, to continue to drive improved practices in this important area.’

APRA has invited submissions on draft SPG 223 by Monday 19 January 2015.

Draft SPG 223 and an accompanying letter can be found on APRA’s website.

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, private health insurers, friendly societies, and most members of the superannuation industry. APRA currently supervises institutions holding $6 trillion in assets for Australian depositors, policyholders and superannuation fund members.