ASIC flags SMSF investors in scam risk

 

Don't become a victim of a scam, be careful because it's easily done.

 

The corporate regulator, ASIC, has flagged significant concerns about SMSF investors falling victim to scams, in some cases even more so than other Australian investors.

ASIC published a report yesterday that indicates a wide variety of scams, including investment and 'get rich quick' scams, continue to hit Australian investors each year.

ASIC said that many people aged over 55 are attracted to the prospect of solid investment returns in a low interest rate environment and thus are often most at risk.

Speaking to SMSF Adviser, an ASIC spokesperson said SMSF trustees in particular need to be “very aware” of the likelihood of being “taken for a ride” with scammers.

“In some ways, the threat may be even worse as there is the added pressure of needing to fund a sufficient-yielding investment strategy that can result in investor over-reach or, in this case, poor decisions caused by limited due diligence,” the spokesperson said.

“SMSF trustees need to be especially aware of this risk and their responsibility to employ the cautionary principle,” the spokesperson added.

ASIC said it received 367 reports about scams in 2015, but it believes that many scams often go unreported.

“The number of Australians contacted by scammers, and the amounts of money lost, are likely to be much larger than what is reported to us,” said ASIC’s deputy chairman Peter Kell.

The top five scams of 2015 included overseas cold-calling about investment opportunities; overseas calls offering easy credit or loans after payment of an upfront fee; sports arbitrage or gambling schemes; money transfer schemes (job opportunity or other fraud); and fake debt and invoice scams.


Written by Katarina Taurian 
Tuesday, 17 May 2016
SMSFadviser.com.au

  • COVID-19 resources -Update July 2020

    Several new links have been added to the many already in this article, links that date back to the beginning of the COVID-19 pandemic. If you have any questions, or require further assistance, please send us an email or phone.

  • 'But how will we pay for this?'

    It's a natural question about global policymakers' multitrillion-dollar efforts to prop up economies and markets against the monumental threat of the COVID-19 pandemic. And the question has understandably taken a back seat to confronting immediate health and welfare challenges.

  • SMSFs urged to review leases before granting rent relief

    SMSF clients planning to provide rent reductions to tenants should review the lease agreement to ensure the provision of rent relief won’t result in a breach of the lease, says an industry lawyer.

  • New financial year to bring new rules for super

    As the 2019–20 financial year draws to a close, a technical expert has highlighted some of the new rules commencing for super funds for the 2020–21 financial year.

Read more latest Financial Planning news articles

General Advice Warning

The information provided on this website has been provided as general advice only. We have not considered your financial circumstances, needs or objectives and you should seek the assistance of your adviser before you make any decision regarding any products mentioned in this communication. Whilst all care has been taken in the preparation of this material, no warranty is given in respect of the information provided and accordingly neither Retirewell Financial Planning nor its related entities, employees or agents shall be liable on any ground whatsoever with respect to decisions or actions taken as a result of you acting upon such information.