COVID-19 FOI Request:Copy of a Response on a "Straw Man Complaint"

Phillip Sweeney made this Freedom of Information request to Australian Securities and Investments Commission

The request was successful.

From: Phillip Sweeney

Delivered

Dear Australian Securities and Investments Commission,

In a letter dated 31 March 2009 I lodged a complaint with ASIC on the advice of APRA.

I had been seeking access to the original Trust Deed and amending Deeds of the employer-sponsored superannuation fund of which I was a beneficiary (ie member) since January 2007 after my contract of employment had been terminated after 21 years of service.

The nature of my complaint was confirmed in a letter dated 22 April 2009 {ASIC Ref: 15476/09) signed by Greg Hackett.

I had complained to ASIC that the incumbent trustee who was administering this occupational pension scheme established by a Trust Deed made on the 23 December 1913 in the State of South Australia was refusing access to the original Trust Deed and all amending Deeds executed on or before 25 March 1985.

These Deeds when read as ONE LEGAL DOCUMENT document form the "governing rules" of this superannuation scheme as they stood on 25 March 1985 when a promise was made to me concerning my superannuation entitlement BEFORE I accepted an offer of employment.

The value of the superannuation "promise" was worth approximately 20% on top of the "cash salary" of $36,000 promised to me by Brian O'Callagnan on 25 March 1985 BEFORE I accepted an offer of employment.

In 1985 this particular DEFINED BENEFIT occupational pension scheme was known as the Foster's Group Superannuation Fund. This DEFINED BENEFIT occupational pension scheme was closed to NEW members on 30 November 1997.

Most members still alive are now over the age of 60 which is the high-risk age group for COVID-19.

A trustee who refuses access to the Deeds of the fund to a beneficiary {which includes a fund member} commits a criminal offence by contravening subsection 1017C(5) of the Corporations Act 2001 and related Regulations. The maximum penalty was two years imprisonment prior to the Hayne Royal Commission.

This maximum penalty has been increased following the recommendations of Royal Commissioner Hayne to 5 years imprisonment {Refer to Section 54B of the Superannuation Industry (Supervision) Act 1993).

Instead of enforcing subsection 1017C(5) of Corporations Act 2001, Warren Day investigated his own "Straw Man" complaint following a phone discussion.

The "Straw Man" complaint that Warren Day created was that the "superannuation salary" used to determine a purported "lump sum" benefit of the Complainant had not been correctly determined.

However, the benefit provided by the original Trust Deed and all properly executed amending Deeds is a life pension benefit {Including a survivorship pension for the widow of a deceased fund member and not a "lump sum benefit".

This has been confirmed by an Act of the Parliament of South Australia and supporting evidence available from the Attorney-General's Department of South Australia.

Warren Day failed to obtain a copy of the original Trust Deed and failed to obtain copies of any amending Deeds before issuing a "report" on his "investigation" into his own "Straw Man" complaint.

Warren Day relied on hearsay evidence from the sponsoring employer who has no legal obligation to pay any particular benefit to the beneficiaries of this superannuation trust.

The legal obligation of the sponsoring employer of a DEFINED BENEFIT superannuation scheme is to ensure the solvency of the scheme by making periodic employer contributions to the fund based on the recommendation of the fund actuary in a triennial actuarial report.

The legal obligation to pay benefits when they fall due rests solely on the incumbent trustee and "salary" used to determine the DEFINED BENEFIT must be in accordance with the terms of the trust as properly construed.

Warren Day failed to obtain copies of any of the Deeds from the incumbent trustee that would confirm how "salary" for superannuation purposes was prescribed by the terms of this superannuation trust.

If Warren Day had obtained copies of the Original Trust Deed and copies of LEGALLY VALID amending Deeds he would have quickly determined that the lawful benefit was a life pension and not a "lump sum" benefit.

Warren Day would have also determined that the widows of male fund members were entitled to a survivorship pension as provided by covenant Rule 30A added by a validly executed amending Deed dated 30 November 1974.

This oversight by Warren Day now has some significance now that some male fund members will be dying due to COVID-19 in the coming months and years with current checking underway to confirm whether some male fund members have already succumbed to COVID-19.

The incumbent trustee of this DEFINED BENEFIT occupational pension scheme since 1 July 2016 is NULIS Nominees (Australia) Ltd {NULIS}, a subsidiary company of National Australia Bank {NAB}.

ASIC currently has proceedings against NULIS afoot in the Federal Court in relation to the failure of NULIS to properly administer other superannuation funds of which NULIS is the responsible entity following the findings of Royal Commissioner Hayne {Reference NSD1654/2018}.

The document I seek is a copy of the letter dated around mid-2010 in which Warren Day reported on the "investigation" into his own "Straw Man" complaint.

Yours faithfully,

Phillip Sweeney

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From: Krystal Fung
Australian Securities and Investments Commission


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Attachment 20200710 FOI 110 2020 Section 24AB Notice.pdf
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Dear Mr Sweeney,

 

Freedom of Information Request No. 110-2020

 

Please find attached notice of a request consultation process due to a
practical refusal reason, pursuant to s 24AB of the FOI Act.

 

Regards,

 

Krystal Fung
Analyst, Escalated Matters & Government, Assessment & Intelligence

Australian Securities and Investments Commission

Level 7, 120 Collins Street, Melbourne, 3000

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John Smith left an annotation ()

This practical refusal is quite puzzling. The document requested has a specific time window, document type, and the matter it relates to is also specified.

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From: Phillip Sweeney

Delivered

Dear Krystal Fung,

I refer to your letter of 10 July 2020 {ASIC ref: FOI 1 10-2020}

This letter makes reference to the following five FOI requests:

(i) COVID-19 FOI Request: Copy of a Response on a “Straw Man Complaint” 28 June 2020
(ii) COVID-19 FOI Request: Copy of false and misleading information provided to Senator Williams” 29 June 2020
(iii) COVID-19 FOI Request: Copy of an original Trust Deed” 29 June 2020
(iv} COVID-19 FOI Request: Copy of false and misleading information provided to Senator Williams” 30 June 2020
{v} COVID-19 FOI Request: Definition of “the governing rules” 30 June 2020

The first four relate to documents that do exist.

The fifth relates to documents that may exist but are unlikely to exist.

The fifth request seeks “ a copy of any legal opinion in the possession in the possession of ASIC or a similar document ….”

It is the fifth COVID-19 FOI Request: Definition of “the governing rules” {30 June 2020} that does not adequately identify the documents sought.

The reason being that such documents as requested related to a legal opinion are unlikely to exist

I, therefore, agree to withdraw the fifth COVID-19 FOI Request: Definition of “the governing rules” {30 June 2020}, leaving the other four COVID-19 FOI Requests which related to identifiable documents that do exist.

Yours sincerely,

Phillip Sweeney

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From: Krystal Fung
Australian Securities and Investments Commission


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Attachment 20200720 FOI 110 2020 Section 24AB Notice.pdf
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Dear Mr Sweeney,

 

Freedom of Information Request No. 110-2020

 

Please find attached a further notice of a request consultation process
due to a practical refusal reason, pursuant to s 24AB of the FOI Act.

 

Krystal Fung
Analyst, Escalated Matters & Government, Assessment & Intelligence

Australian Securities and Investments Commission

Level 7, 120 Collins Street, Melbourne, 3000

[1][email address]

[2]ASIC logo

 

 

Please consider the environment before printing this document.

 

Information collected by ASIC may contain personal information. Please
refer to our [3]Privacy Policy for information about how we handle your
personal information, your rights to seek access to and correct
your personal information, and how to complain about breaches of your
privacy by ASIC.

 

This e-mail and any attachments are intended for the addressee(s) only and
may be confidential. They may contain legally privileged, copyright
material or personal and /or confidential information. You should not
read, copy, use or disclose the content without authorisation. If you have
received this email in error, please notify the sender as soon as
possible, delete the email and destroy any copies. This notice should not
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From: Phillip Sweeney

Delivered

Dear Krystal Fung,

I refer to your letter of 20 July 2020 {ASIC Re: FOI 110-2020}

You state:

“In your Request (at part 1), you refer to your complaint to ASIC dated 31 March 2009 (ASIC reference: 15476/09) and Mr Greg Hackett’s response dated 22 April 2009 to this complaint.”
I had written to ASIC on the recommendation of APRA after the incumbent ‘trustee’ over the previous two years had refused to provide access to the original Trust Deed and all amending Deeds executed on or before the 25 March 1985 when a promise had been made to me about my retirement benefits before I accepted an offer of employment.

In his letter dated 22 April 2009, Mr Hackett stated:

“In your letter, you request ASIC’s assistance to compel the Trustee to provide you with a copy of the Trust Deed {ie the term of the trust} that was in place on 25 March 1985. You state that you will then be able to obtain independent legal advice about your entitlements.
In order to assess your complaint accurately, I will need to contact the Trustee about your circumstances.”

The incumbent trustee has the legal obligation to pay the correct benefits to the correct beneficiaries.

The sponsoring employer has no legal obligation to pay superannuation benefits.

In the case of a Defined Benefit fund, the sponsoring employer’s legal obligation is limited to providing periodic employer contributions to the fund in accordance with the advice of the fund actuary.

In my letter to ASIC on 31 March 2009, I did not make a complaint about how my “superannuation salary” should be calculated by the incumbent trustee.

The purported ‘complaint’ about “superannuation salary” was a complaint created by Warren Day – that is a “straw man” complaint which Mr Day then ‘attacked’.

To correctly resolved his own complaint Mr Day should have contacted the ‘trustee’ and obtained a copy of the original Trust Deed and copies of all amending Deeds where the definition of “superannuation salary” had been amended.

The trustee has a legal obligation to pay benefits in accordance with the definition at the time a release event occurs such as retrenchment or retirement.

If Mr Day had obtained copies of these Deeds he would have been able to report in his subsequent letter that the original definition of “superannuation salary” was the average of the fund member’s total salary over all the years of service divided by the numbers of years of service to the sponsoring employer.

Later amending Deeds improved the benefit by altering the definition of “superannuation salary” to the average of the last 10 years of service, then to the average of the last 7 years of service, then to the average of the last 5 years of service and then finally to the average of the last 3 years of service.

There was no need for Mr Day to contact the sponsoring employer since it is the trustee who holds possession of these Deeds and who has the legal obligation to pay the correct benefits to the correct beneficiaries.

You state:
“However, I have identified a document dated 2 July 2010 from Mr Warren Day address to you”.

If Mr Day makes reference in this letter to contacting the sponsoring employer, which in 2010 was known as Foster’s Group Limited to request information on how “superannuation salary” was to be determined then this confirms that Mr Day was seeking information from the wrong party!

Foster’s Group Limited has no legal obligation to pay any superannuation benefits. The legal obligation rests with the incumbent trustee who must use the definition of “superannuation salary” as found in the original Trust Deed and any relevant VALID amending Deeds.

Any information provided by Foster’s Group Limited to Mr Day was mere ‘hearsay evidence’ and should have been treated as such by Mr Day.

If Mr Day makes mention of contacting the wrong party– Foster’s Group Limited in the letter dated 2 July 2010 then this will be the document that I am seeking at part 1.

You state on page 2:

“In your Request (at part 2), you refer to a request for information by Senator John Williams to ASIC dated 6 January 2014 and characterise ASIC’s response to that request as “false and misleading information provided to Senator Williams” The Request seeks “a copy of the response sent to Ms Tenaski to former Senator John Williams sometime after 6 January 2014”.

Whilst I am unable to identify any document which may be “false and misleading” my searches have identified a document dated 17 January 2014 from Ms Belinda Taneski responding to his request dated 6 January 2014 (ASIC Reference CCU-14\0006}.

In the case of a Defined Benefit superannuation fund, scheme or trust, the incumbent trustee has a legal obligation to determine the benefit based on formulae in the original Trust Deed and all VALID amending Deeds when read as ‘one legal document’ at the time a ‘release event’ occurs such as retrenchment, total and permanent disability or retirement.

{Refer to the ruling of the Federal Court in Commissioner of Taxation v Commercial Nominees of Australia Ltd [1999] FCA 1455 stated at [41], which was affirmed in the High Court in Commissioner of Taxation v Commercial Nominees of Australia Limited [2001] HCA 33.}

There is no such thing as “old trust deeds” and if Ms Taneski makes mention of “old trust deed” in her letter dated 17 January 2014, then this is the letter that I am seeking.

Furthermore, a person who has received a “payout” from a trustee, whether correctly or incorrectly determined retains the legal status of a ‘beneficiary’ of that fund, scheme or trust.
{Refer to Re HIH Superannuation Pty Ltd [2003] NSWSC 65}

If this was not the case then a dishonest trustee would be in the position to commit ‘The Perfect Crime’ by underpaying the beneficiary and then preventing the beneficiary from checking that he or she had been underpaid!!!!!

If Ms Taneski makes reference to a “concerned person” as being someone who is entitled to receive a “payout” from the fund, but does not include someone who has received a ‘payout’ (ie a beneficiary), then this will also be the letter that I am seeking.

You state on page 2:
In your Request (at part 4), you refer to a request for information by Senator Williams to ASIC dated 28 January 2014 and characterise ASIC’s response as “false and misleading information provided to Senator Williams”. In discussing this document, you note that:

“Therefore, Mr Fitzpatrick provided former Senator Williams with false and misleading information related to:
- The provisions of statutory law; namely the provisions of section 1017C of the Corporations Act 2001; and
- The provisions of the general law of trusts; namely how a trustee must interpret the original Trust Deed and all VALID amending Deeds executed up until the time a ‘release event’ occurs when determining a benefit payment or payments.”

You then make reference to a document dated 11 February 2014 from Mr Gerard Fitzpatrick addressed to Senator John Williams responding to his request for information dated 28 January 2014 {ASIC reference CCU-14\0060}.

It appears to be a common practice at ASIC to misquote section 1017C of the Corporations Act 2001.

Former ASIC officer, Monique Adofaci also misquoted section 1017C to Alisha Hill an investigative officer at the Commonwealth Ombudsman, which is now the subject of an FOI request to the Commonwealth Ombudsman.

In the email sent to Robert Rush on 28 January 2014 by Senator Williams, Senator Williams was seeking information including the following:

“What are a trustee’s obligations in providing members with access to the deeds of the trust?”

The statutory right that codifies the general law right in found in subsection 1017C(5) of the Corporations Act 2001 and related Regulation 7.9.45.

In his response to Senator Williams, Mr Gerard Fitzpatrick should have advised the Senator of these provisions and also advised that the penalty for failing to provide access to a fund member or a beneficiary (including wives and widows of fund members) was in 2014 a fine and/or two years imprisonment.

{Note: In accordance with Recommendation 3.7 of Royal Commissioner Hayne the maximum penalty has since 5 April 2019 been increased by the Parliament to a higher fine and up to 5 years imprisonment}

Instead of advising Senator Williams of the right of access to the deeds of the fund, scheme or trust provided by subsection 1017C(5), Gerard Fitzpatrick only makes mention of a “right to information” – which is provided by subsection 1017C(2) of the Corporations Act 2001.

The terms of a trust are determined by reading the original Trust Deed and all VALID amending deeds as “one legal document”.

A trustee has no legal right to only allow access to some on these deeds or only to an administrative consolidation of the executed deeds {which has no legal substance}.

Access to the original Trust Deed and all VALID amending deeds executed up until the time of a ‘release event’ is necessary to determine whether or not the trustee has paid the correct benefits to the correct beneficiaries – this is especially the case where a Defined Benefit fund is involved.

If Gerard Fitzpatrick makes the following representation to Senator Williams, then this is the document I seek:
“It is open to the trustee to take the view that a fund member or former fund member is not entitled to these documents”.

Concealing the original Trust Deed and any of the VALID amending Deeds from a ‘beneficiary’ of a fund, scheme or trust is the very essence of a fraudulent breach of trust, to which civil and criminal penalties apply pursuant to Section 54B of the Superannuation Industry (Supervision) Act 1993 since 5 April 2019.

{Refer to the ruling of the Federal Court in Commissioner of Taxation v Commercial Nominees of Australia Ltd [1999] FCA 1455 stated at [41], which was affirmed in the High Court in Commissioner of Taxation v Commercial Nominees of Australia Limited [2001] HCA 33.}

I note that you have not made reference to Part 3 – please feel free to seek clarification on the document sent by Warren Day to former Senator Williams sometime after 18 July 2013 which was also false and misleading.

I also note that there is no equivalent of subsection 13(9) of the Public Service Act 1999 in ASIC new self-drafted Code of Conduct in effect since 1 July 2019.

Subsection 13(9) states:

"An APS employee must not provide false or misleading information in response to a request for information that is made for official purposes in connection with the employee's APS employment."

These FOI requests highlight the reason why at a time when the COVID-19 crisis has brought the right to have access to ALL the deeds of a superannuation fund, scheme or trust back into the public spotlight, especially those that provide a death benefit to the wives whose husband might succumb to COVID-19.

This includes the obligation to provide access to all the deeds on a trustee's website pursuant the provisions of the Superannuation Legislation Amendment (Further MySuper and Transparency Measure) Act 2012 which should have been mentioned by ASIC officers responding to Senator Williams in 2014 - the year these public disclosure obligations came into effect.

Thus since 2014 not only do fund members and beneficiaries have a right of access to the original Trust Deed but also do members of the public, including financial journalists, investments analysts and financial advisors and other 'gatekeepers'.

ASIC is the agency responsible for administering these public disclosure obligations.

Refer to ASIC's Regulatory Guide 252 - Keeping Superannuation Websites up to date.

So why was Senator Williams not advised on the provisions of the Superannuation Legislation Amendment (Further MySuper and Transparency Measure) Act 2012 by Warren Day, Belinda Taneski and Gerard Fitzpatrick?

An example of a trustee who complies with its public disclosure obligations for ALL the deeds of a superannuation fund, scheme or trust is the trustee of the Australia Post Superannuation Scheme at:

https://www.apss.com.au/about/?page=poli...

Also note this important disclaimer about an administrative consultation of the original Trust Deed and amending Deeds {Deeds of Modification}.

"*The approved Trust Deed has been modified over time. The following documents provide the details of each of these modifications approved by the Trustee. The APSS Trust Deed (Approved) above, plus the Deeds of Modification below are therefore the official APSS Trust Deed. In the event of any conflict, these documents will always overrule the above APSS Trust Deed (Consolidated/Unofficial). The Consolidated/Unofficial version is a handy reference to the Trust Deed, incorporating all the modifications, but is not the final approved authority if there are any discrepancies."

Yours sincerely,

Phillip Sweeney

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From: Krystal Fung
Australian Securities and Investments Commission


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Attachment 20200731 FOI 110 2020 Notice of third party consultation.pdf
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Dear Mr Sweeney

 

Please see attached Notice of Extended Timeframe due to Third Party
Consultation.

 

Regards,

 

Krystal Fung
Analyst, Escalated Matters & Government, Assessment & Intelligence

Australian Securities and Investments Commission

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Information collected by ASIC may contain personal information. Please
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From: Krystal Fung
Australian Securities and Investments Commission


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Attachment 20200831 FOI 110 2020 Notice of Access Decision.pdf
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Attachment Document 2 20130806 CCU 13 0685.pdf
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Attachment Document 3 20140117 CCU 14 0006.pdf
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Attachment Document 1 20100702 CCU 10 0195.pdf
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Dear Mr Sweeney

 

Freedom of Information Request 110-2020 – Notice of Access Decision

 

Please see the attached decision.

 

Regards

 

Krystal Fung
Analyst, Escalated Matters & Government, Assessment & Intelligence

Australian Securities and Investments Commission

[1][email address]

[2]ASIC logo

 

 

Please consider the environment before printing this document.

 

Information collected by ASIC may contain personal information. Please
refer to our [3]Privacy Policy for information about how we handle your
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