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ASIC says it is worried that some lead generation practices in financial advice and super may expose Aussies to significant losses. (Source: Getty) <\/p>\n ASIC says it is worried that some lead generation practices in financial advice and super may expose Aussies to significant losses. (Source: Getty) <\/p>\n
The corporate regulator in Australia has launched a fresh review<\/a> into the practice of using lead generators to lure in the large piles of money in workers’ superannuation accounts, with more than 40 groups called out. The often aggressive marketing practice is what drove thousands of Aussies to invest around $1.2 billion of their retirement savings<\/a> into the collapsed Shield and First Guardian funds<\/a>.<\/p>\n Lead generation is the process of identifying someone as a potential sales target. Lead generators may offer a free \u2018super health check\u2019 or offer to find your lost super, which can be sales tactics designed to pressure you to switch superannuation<\/a> accounts.<\/p>\n Lead generators are often paid \u201cmarketing fees\u201d by licensed financial advisers for generating leads. This is what happened in the cases of the Shield and First Guardian<\/a>.<\/p>\n RELATED<\/p>\n The Australian Securities and Investments Commission (ASIC) has released a list of 44 known entities <\/a>involved in lead generation as part of a new review of financial advice licensees using lead generation services.<\/p>\n \u201cASIC is concerned that certain practices associated with some lead generation services in financial advice and superannuation may expose consumers to a risk of significant losses,\u201d the regulator said.<\/p>\n \u201cThe naming of the entities in this list should not be construed as an indication by ASIC that a contravention of the law has occurred, nor should it be considered a reflection upon any person or entity.\u201d<\/p>\n Do you have a story to share? Contact tamika.seeto@yahooinc.com<\/a><\/p>\n The list includes 21 lead generators themselves, many of which have websites that have search terms people would use if they wanted to switch super, like www.checkmysuper.com and www.mysupercheckup.com.au.<\/p>\n It also includes 23 advice licensees or corporate representatives who have acquired leads since July 1, 2024.<\/p>\n Three advice firms on the list, including Clear Sky Financial, were authorised representatives of InterPrac Financial Planning, which was the licensee at the centre of the Shield and First Guardian scandals<\/a>.<\/p>\n The list isn\u2019t an exhaustive one, with ASIC planning to update the list throughout the course of its review, which will happen over the course of the year.<\/p>\n Super Consumers Australia is calling for a ban on lead generation for super and financial advice, along with closing the loophole that allows cold calling offering financial advice.<\/p>\n The group said predatory super switching schemes had been fuelled by lead generators who had been using social media to collect people\u2019s contact details and sell them on to third parties.<\/p>\n \u201cThese schemes are highly effective, they prey on people who are just looking to do the right thing and get on top of their super,\u201d Super Consumer Australia CEO Xavier O\u2019Halloran said.<\/p>\n \u201cThey often start by simply offering a super health check, but can end in people losing their life savings in high fees and dodgy investments.\u201d<\/p>\n O\u2019Halloran said the cost of poor consumer protections was falling on everyone, through direct losses, compensation scheme funding<\/a> and increased age pension costs.<\/p>\n ASIC is urging consumers to be cautious if someone calls them about their super.<\/p>\n You may get a call after clicking on an ad on social media, filling out a form on a super comparison website, or out of the blue. If you are feeling pressured or unsure, just hang up.<\/p>\n Red flags to watch out for include:<\/p>\n Being pressured to act immediately<\/p>\n Claims that your existing fund is underperforming<\/p>\n The touting of free superannuation \u2018health checks\u2019 and prizes<\/p>\n Offers to find and consolidate \u2018lost super\u2019 for free<\/p>\n The involvement of unlicensed people in the advice process<\/p>\n Predominant engagement over the phone with limited client contact with a financial adviser<\/p>\n Poor or no product disclosure<\/p>\n Promises of high or unrealistic returns<\/p>\n Get the latest Yahoo Finance news – follow us on Facebook<\/a>, LinkedIn<\/a> and Instagram<\/a>.<\/p>\n Aussies are being told to be cautious if someone calls them about their super. (Source: Getty) <\/p>\n