ASIC cracks down on SMSF property groups

The corporate watchdog says property spruiking is the “largest concern” facing the SMSF sector after a Federal Court case found one property developer scammed hundreds of investors.

Commissioner Greg Tanzer stressed the importance of a recent Federal Court ruling that Gold Coast property developer Craig Gore and associates duped hundreds of investors into investing in a property scam in the US, according to Fairfax reports.

"The judgement did confirm our view that those who promote and make recommendations to investors about establishing an SMSF or using an existing one to recommend that they manage their assets in a particular way or dispose of superannuation assets are carrying on a financial services business and therefore need a licence," Mr Tanzer said.

"Obviously the judgement goes further than that and makes [a] finding about the conduct of individual directors and that they were knowingly concerned in those contraventions and the result of that unlicensed activity is that a number of investors lost substantial funds."

Since the establishment of the SMSF task force in 2012, ASIC has been meeting regularly to examine what it considers “high-risk and emerging SMSF issues”, such as property spruiking to SMSFs.

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