A self-managed superannuation fund (SMSF) is a superannuation fund that you manage yourself or in a group of up to six people to help you save for retirement. Often, SMSFs are set up for a couple to help build for their joint retirement. SMSFs can provide you with choice and freedom in your investments; they can also be used to coerce someone into making decisions or managing the SMSF in a particular way for the benefit of one party.
All members of the SMSF are responsible for its investment decisions and must comply with Australian superannuation and taxation laws, even if your circumstances change – for example, you lose your job. There can also be a negative impact on your SMSF if there is a relationship breakdown.
An SMSF can be manipulated by an abusive partner. For instance, they might remove your access to it. They may also try and coerce you into making decisions that are beneficial only to them, or increase the vulnerability of your super for instance by rolling your existing super into an SMSF. Never take financial advice from anyone other than a trusted and registered financial adviser. You can check if they are registered using the Financial Advisers’ Register.
Further abuse can occur if the perpetrator steals your personal information, including your Tax File Number (TFN) or access to your MyGov account. This can enable them to commit fraud by creating a self-managed super fund in your name and transferring any superannuation you have with another fund into an account that only they can access - effectively stealing all your retirement savings. Once these funds are transferred, getting the money back is extremely difficult.
A significant drawback of self-managed super funds is that unlike industry or retail funds, if you lose your money through theft or fraud, you cannot access any special government compensation schemes, nor can the Australian Financial Complaint Authority support you. If you suspect that your partner, or ex-partner, has stolen or misused your personal information to set up an SMSF under your name, or removed your access to an existing SMSF, contact the ATO immediately. You can also consider reporting the fraud to the police.
If the fraudulent activity results in financial hardship, contact a financial counsellor for support to get your finances back on track.