In its second submission to the Financial System Inquiry APRA has argued against the prudential regulation of SMSFs and against direct leverage by superannuation funds.
No prudential regulation of SMSFs
While saying that there is a “strong case” for the prudential regulation of the currently APRA-regulated super funds, APRA said “that does not extend to self-managed superannuation funds”.
Given that SMSFs involve the members also being the trustees, or the directors of the corporate trustee, APRA says that the “interests of members and trustees are naturally aligned”.
“The cost of prudentially regulating SMSFs would, simply by virtue of the sheer number of such funds, be substantial and significantly outweigh any benefits,” said APRA.
Read More »SMSFs shouldn’t be prudentially regulated, says APRA