The Federal Court has imposed a $25,000 penalty against online SMSF administration and accounting service provider Superannuation Warehouse Australia (SWA) for false and misleading advertising.
The penalty was given in relation to promotions SWA ran on its websites between 22 January 2014 and 8 May 2015 claiming it was providing a free SMSF establishment service.
The court found the establishment service was not free as the application to set up an SMSF through SWA relied upon the applicant agreeing to use the organisation’s administration service for a fixed monthly fee and applicants had to put a monthly payment plan in place for the administration fees.
SWA admitted its advertising material was false and misleading, and in addition to the $25,000 fine it consented to implement a compliance program, post notices on its websites about the promotion in question, and to notify consumers who applied for the free SMSF set-up service about the issues associated with it.
“Deciding to establish a self-managed superannuation fund is a significant financial decision,” Australian Securities and Investments Commission (ASIC) deputy chair Peter Kell said about the case.
“Consumers should not be misled by advertising, including online. ASIC considers that terms such as ‘free’ convey a strong impression to consumers and should not be used where there is any charge or cost associated with the product or service advertised.”
ASIC issued a civil penalty proceeding in the Federal Court as a result of further investigations into SWA after the organisation failed to pay an initial fine of $10,200 imposed by the corporate regulator for misleading website advertising.
