![\"Molly](\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2026\/05\/328a5d70-4a6f-11f1-b7bd-1d23f93f8224.png\")
Molly Wilkes and her mother Julie, who futility fought against her abusive spouse receiving her super death benefits. (Source: ABC via Julie Adams) <\/p>\n Molly Wilkes and her mother Julie, who futility fought against her abusive spouse receiving her super death benefits. (Source: ABC via Julie Adams) <\/p>\n
A long called for change to the complex law<\/a> that governs the distribution of superannuation benefits<\/a> is set to be pushed through by the federal government. After years of campaigning from the industry, the reform will seek to prevent the perpetrators of domestic abuse from gaining superannuation payouts from the fund of their victim.<\/p>\n In the wake of some harrowing examples in recent years, those in the industry have called for the government to close a “loophole” in the legislation. Under the current law, a fund may be required to pay superannuation death benefits to a person who used domestic and family violence (DFV) against the deceased.<\/p>\n “Many Australians are absolutely shocked to understand that this loophole still exists in the law,” Misha Schubert, the CEO of the Super Members Council of Australia, told Yahoo Finance.<\/p>\n “It’s something that most Australians find deeply shocking to think this could occur.”<\/p>\n RELATED<\/p>\n Molly Wilkes tried to leave her partner on multiple occasions after suffering coercive control and physical abuse. When the 22-year-old woman took her own life, her devastated family later learned there was no discretion for her superannuation fund to block the life insurance-like payment to her husband.<\/p>\n Despite her mother, Julie Adams, being listed as the beneficiary of her account, the Superannuation Act meant the trustee had no choice but to pay the $65,000 benefit to her spouse.<\/p>\n “Despite many attempts from me to stop him from being able to access that money, he was paid out that $65,000 for a death that I believe he was quite significantly the cause of,” her mother told a parliamentary inquiry in 2024.<\/p>\n Under existing laws, a perpetrator can claim a spouse or partner\u2019s super death benefits unless their actions are found to be the direct cause of that person\u2019s death, even where there is clear evidence of abuse.<\/p>\n According to the government’s consultation paper<\/a>, only around 10 per cent of superannuation members have a binding death benefit nomination in place.<\/p>\n The federal government’s consultation period with the public and industry to change the law and end outcome’s like this wrapped up last month. The Super Members Council (SMC) is among those who have welcomed the move to close loopholes it says “reward abuse” and entrench harm.<\/p>\n Story continues <\/p>\n In particular it is backing a proposal by Treasury to more strongly codify a forfeiture-like rule in legislation that would apply to superannuation funds.<\/p>\n “There’s a principle of forfeiture law in wider common law … This is a common principle in other parts of the law, where if someone is convicted of killing a person, they are not able to profit from that person’s death in any way,” Schubert explained.<\/p>\n Treasury is also examining how cases like Molly’s can see super trustees endowed with more discretion over the handling of payouts in the event of domestic abuse.<\/p>\n “The second suite of proposals that Treasury really tested are a series of ways in which you could handle those sorts of cases,” Schubert said. “So one would be to have a very prescriptive approach in the law, where if a certain set of conditions have occurred, then the trustees would be required to act to deny that super to the perpetrator.”<\/p>\n A potential third option explored by the government would involve referring difficult cases of deceased estates to the family court.<\/p>\n “We don’t support sending these cases off to the courts because we’re acutely aware that in many cases, you’re talking about families that are deep in grief,” she said.<\/p>\n Change to superannuation law ‘long overdue’ <\/p>\n In its submission to Treasury, the SMC also called on the government to consider similar victim-centred reforms for self-managed super funds, and ensure trustees can apply the proposed new law to different types of super arrangements such as reversionary pensions and defined benefit schemes.<\/p>\n “Closing this loophole is about ensuring the system does not compound injustice and that people who cause harm do not profit from it,” the industry group said.<\/p>\n On Friday, Super Consumers Australia, the Economic Abuse Reference Group (EARG), Redfern Legal Centre, Domestic Violence NSW, the Australian Multicultural Women\u2019s Alliance, Safe and Equal and the organisation Each issued a joint media release also applauding the government’s intention to address the issue.<\/p>\n “This reform is long overdue,” Super Consumers Australia Director of Advocacy, Lily Jiang, said.<\/p>\n “We welcome the Government taking action but the solution needs to make all super trustees responsible for considering DFV in death benefit claims and deliver fair and consistent outcomes for people impacted by DFV and abuse.”<\/p>\n Get the latest Yahoo Finance news – follow us on Facebook<\/a>, LinkedIn<\/a> and Instagram<\/a>.<\/p>\n