In this edition, we discuss the infringement notices issued to Retail Employees Superannuation Pty Ltd (Rest Super) by the Australian Securities and Investments Commission (ASIC) for misleading insurance disclosures, the disqualification of a director for governance failures, insolvent trading and unpaid wages and ASIC’s comments regarding weaknesses in super fund financial reporting and audits. We also cover ASIC’s commencement of civil penalty proceedings against Fiducian Investment Management Services Limited (FIMSL) for alleged governance and disclosure failings.
In Over the Horizon, we examine ASIC’s report into the financial reporting and audit of super funds and consider how the findings might more broadly apply outside the superannuation industry.
Regulatory
ASIC issues infringement notices to Rest Super for insurance failures
On 29 September 2025, ASIC announced that it issued two infringement notices totalling $37,560 to Rest Super for alleged false or misleading representations made after Rest Super inadvertently activated insurance cover for more than 2,000 members. ASIC alleges that Rest Super told affected members that they held active cover and that premiums could be deducted from the member’s superannuation account, despite Rest Super having no right to reinstate cover under law or member elections. ASIC emphasised that addressing member services failures is an enforcement priority for the regulator and that it considers the issue of infringement notices a proportionate response to the alleged contraventions. Payment of an infringement notice is not an admission of liability. However, their issue serves as a reminder of the importance of effective internal controls, the accuracy of disclosures to members and prompt incident remediation.
Director banned for governance failures, insolvent trading and unpaid wages
On 1 October 2025, ASIC announced that it had disqualified Ms Veronica Roberts from managing corporations for the maximum period of five years due to her involvement in four failed companies in the construction industry. The regulator found that Ms Roberts had failed to exercise proper care and diligence in the companies’ governance, failed to keep and maintain proper books and records and traded while insolvent. At the time of ASIC’s decision, the companies owed approximately $3.5 million to unsecured creditors, including $1.2 million in unpaid wages, superannuation and employee entitlements.
Legal
ASIC commences proceedings against Fiducian Investment Management Services Limited for governance and disclosure failings
On 3 October 2025, ASIC commenced civil penalty proceedings in the Supreme Court of New South Wales against FIMSL, an Environmental, Social and Governance (ESG) investment fund, alleging a failure to act with care and diligence and misleading conduct as the responsible entity of the Diversified Social Aspirations Fund (Fund). ASIC claims the Fund’s Product Disclosure Statement contained false and misleading statements that it would monitor the portfolio exposure and investment styles of underlying funds in circumstances where FIMSL did not have the requisite information to conduct that monitoring. The proceedings signal heightened scrutiny of ESG claims and the expectation that responsible entities can evidence screening, oversight and compliance over the product lifecycle. Directors should anticipate further greenwashing enforcement activity and revisit complaint-handling frameworks and risk management processes to ensure ESG statements are accurate and substantiated.
Over the Horizon
ASIC flags weakness in super fund financial reporting and audits
On 30 September 2025, ASIC released Report 816 Accounting for your super: ASIC’s review into the financial reporting and audit of super funds for FY 2024–2025. The Report notes that as Australia has the world’s fourth largest pension pool and the superannuation system is a significant force in Australia’s capital markets, confidence in the quality of audited reports underpins confidence in the accuracy of information and drives informed decision-making. Against that backdrop, ASIC undertook a review of the quality of 60 financial reports of Registrable Superannuation Entities (RSEs) and conducted audit reviews of five RSE audit files from five of the largest audit firms that collectively audit the majority of all RSE financial reports, noting that this is the first year that RSE financial reports and audits were part of its surveillance program.
ASIC found inconsistent investment disclosures and insufficient audit evidence in the financial reports, with the review highlighting varied fair value hierarchy practices for unlisted assets, limited visibility of sponsorship and advertising expenses and auditors not adequately challenging valuations while applying high materiality levels. Non-executive directors should note that ASIC has expressly stated in the Report that it will continue to focus on RSE financial reports and audits as part of its 2025–2026 surveillance program, particularly in relation to the valuation and disclosure of unlisted investments. ASIC will publish its report on its findings in early October 2025. While the Report concerns RSEs, it serves as a reminder that non-executive directors should ensure that valuations are reliable, fair value disclosures are sufficient to enable members to understand the nature of their investments and assess the reliability of valuations and consider whether lower levels of materiality should apply when conducting audits.