House debates

Thursday, 7 July 2011

Constituency Statements

Trio Capital

9:36 am

Photo of Paul FletcherPaul Fletcher (Bradfield, Liberal Party) Share this | Hansard source

I rise to discuss the collapse of the funds manager Trio Capital Ltd, which has led to many Australians being very severely affected, including a number of my constituents in Bradfield. I have been approached by a number of constituents who invested very substantial amounts of money via self-managed superannuation funds with Trio Capital and its products, including the ARP Growth Fund. After Trio collapsed in 2009 and investigations began, it became clear that there was substantial evidence of fraudulent conduct involved in the substantial loss of money. Over $100 million appears to have been lost. That has been lost principally by two categories of investors: self-managed super funds, as I have mentioned, and also those who invested via what are called APRA, or Australian Prudential Regulation Authority, regulated superannuation funds.

Earlier this year, Assistant Treasurer Bill Shorten announced that there would be compensation for those Australians who had lost money as a result of the Trio Capital collapse who had invested by APRA regulated funds. However, this compensation does not extend to persons, including my constituents, who invested via self-managed superannuation funds, because self-managed superannuation funds are not regulated by APRA.

What has happened here is a real tragedy. Constituents who have been to see me have lost much money. They are people who have sought to do the right thing: to work hard to provide for their own retirement. They are financially sophisticated people. They are people who had accumulated substantial balances, which appear to have completely disappeared. On average, it appears that holders of self-managed superannuation funds have lost balances of $700,000 as a result of this collapse, so this is a very serious matter.

It should be fully investigated and pursued with vigour by ASIC. ASIC has certainly taken some action and has provided some funding to the liquidator to continue its investigations. I am also very pleased to note that the Parliamentary Joint Committee on Corporations and Financial Services has resolved to conduct an inquiry into the collapse of Trio Capital and the lessons from it, including—among other things—the policy issues surrounding investments via self-managed superannuation funds and whether there ought to be compensation available in extreme circumstances of fraud and theft.

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