A group of specialist SMSF practitioners has raised concerns about the lack of information regarding security protocols surrounding director identification numbers (DIN).
In particular, the sensitivity of DINs is raising questions as to whether the same rules will be applied to their access as those that apply to an individual’s tax file number (TFN).
During a panel session at the recent online Chartered Accountants Australia and New Zealand SMSF Conference 2021, Accountants IQ founder Bronwyn Speed said: “In the advice world there are plenty of specific rules around the collection and use of TFNs and I wonder if that will be extended then to DINs as well.”
Fellow panellist Deloitte superannuation, SMSF and retirement savings partner Liz Westover pointed out the nature of a DIN would suggest strict security protocols need to be put in place.
“It’s not a piece of information you’d want people to know either. If it’s all about avoiding phoenix activity, then it’s the last piece of information that you’d want getting out,” Westover said.
To this end, Speed suggested DIN information needed to be destroyed and prohibited from being kept on file once the adviser has used it for the particular purpose required.
The panel was unanimous on the role advisers must play in communicating to their clients as to how confidential a DIN is and how closely guarded they should keep them. Specifically, they agreed advisers should be telling clients not to email their DIN to anyone – a practice that has already surfaced in the short time the identification regime has been in place.
Further, practitioners continue to worry about the rule disqualifying advisers from being able to apply for a DIN on their clients’ behalf. To this end. Westover had a recommendation as to how to mitigate complications from this dictate.
“My only other suggestion around this program too is for all advisers to get in and get their own DINs first so that they’re in a really good position to be able to talk their clients through the process,” she said.
Doing so will allow the adviser to know what the client should expect from the process and ensure the client has all of the relevant documentation available when applying for their DINs.
