Australia super funds face legal action over complaint handling, ASIC says

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Highlights

ASIC finds nearly one quarter of 45 superannuation trustees fail to analyze complaints data regularly, risking legal action for inadequate complaint handling.
AFCA receives 8,755 superannuation complaints in 2025-26, a 42 percent year-on-year increase, with benefit denial complaints rising 80 percent.
Trustees identify fewer than half as many systemic issues from complaints as AFCA, despite overseeing $3.4 trillion in retirement savings for Australian members.

ASIC review highlights complaint handling failures

As reported by ABC News, the Australian Securities and Investments Commission says superannuation funds are less effective than the financial ombudsman at resolving member complaints and detecting systemic issues across the sector. The regulator says trustees that fail to improve could face legal action for not meeting their obligations.

ASIC's review covers 45 superannuation trustees and finds members are more likely to obtain a resolution when they take complaints to the Australian Financial Complaints Authority, or AFCA, rather than directly to their fund. Commissioner Simone Constant says trustees must treat complaints as warning signs of broader operational weaknesses, adding that blaming customers is not an acceptable strategy.

The regulator says close to one quarter of trustees are not regularly analysing complaints data to identify systemic issues. More than half of the trustees reviewed identify fewer than five systemic issues from complaints over a two-year period, and 14 trustees do not identify a single issue.

ASIC also points to specific cases where problems appear to persist for long periods before action is taken. In one example, a tax-related system problem is raised through complaints for years before the trustee investigates whether other members are affected, with early estimates suggesting about 1,200 members could be impacted. In another, more than 250,000 members are unable to access documents online at different times.

Rising ombudsman complaints increase pressure on trustees

AFCA says superannuation complaints rise sharply in 2025-26, with 8,755 complaints received, up 42 percent from the previous financial year. Complaints about super funds refusing to pay claims rise by 80 percent, reinforcing ASIC's view that trustees are not learning enough from the issues raised by members.

Between July 1, 2023 and June 30, 2026, ASIC says more than 19,400 complaints are made to AFCA about superannuation matters involving the 45 funds in its industry-wide review. ASIC says AFCA identifies systemic issues from the complaints it receives at almost twice the rate that trustees identify them from complaints made directly to their own operations.

Constant says trustees oversee $3.4 trillion in Australians' retirement savings and are handling decisions that can materially affect households, particularly around death benefits, disability insurance and other claim payments. ASIC says poor communication, unclear processes, delays and system failures can deepen member harm and weaken trust in the superannuation system.

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