Notice of Disqualification – Chantell Hagen – 12 March 2025

Overview

The Superannuation Industry (Supervision) Act 1993 (SISA) was enacted by the Parliament of Australia to regulate the superannuation industry, ensuring it operates in a manner that protects the interests of superannuation fund members. The act was introduced to address the need for stringent oversight and regulation of superannuation entities to prevent mismanagement and fraud. A significant problem the act aimed to resolve was the potential for trustees and responsible officers to act in ways that could jeopardise the financial security of superannuation fund members. The policy objective of the act is to maintain the integrity and stability of the superannuation system by ensuring that only fit and proper persons are appointed to key roles within superannuation entities. This includes the disqualification of individuals deemed unfit to manage superannuation funds, as illustrated in the case of Chantell Hagen, who has been disqualified under the act for not being a fit and proper person to hold such a position.

Scope and Application

The Superannuation Industry (Supervision) Act 1993 (SISA) applies to individuals who are trustees or responsible officers of superannuation entities, ensuring they meet the required standards of fitness and propriety. The Act has a Commonwealth reach, meaning it applies across Australia and is enforced by the Commissioner of Taxation. In the case of Chantell Hagen, the Commissioner's delegate, Emma Rosenzweig, has disqualified her from holding such positions due to a determination that she is not a fit and proper person. This disqualification is effective immediately and will be published in the Federal Register of Legislation as a notifiable instrument. Additionally, the Act prohibits disqualified individuals from acting as trustees, investment managers, or custodians of superannuation entities, with a potential penalty of up to two years imprisonment for violations. The disqualification can be reviewed or revoked by the Commissioner, either on the authority's own initiative or upon a written application by the disqualified individual. Furthermore, dissatisfied parties have the right to request a reconsideration of the decision within 21 days of receiving the notice.

Key Provisions

The primary operative sections of the Superannuation Industry (Supervision) Act 1993 (SISA) in this context are sections 126A and 126K. Section 126A(3) allows a delegate of the Commissioner of Taxation to disqualify a person from being a trustee or responsible officer of a superannuation entity if they are not considered a fit and proper person. This disqualification takes immediate effect as stated in subsection 126A(6). Section 126K further stipulates that it is an offence for a disqualified person to act as a trustee, investment manager, custodian, or responsible officer of a superannuation entity. Under the SISA, the obligations imposed on the disqualified individual, Chantell Hagen, include compliance with the disqualification order and refraining from acting in any capacity as a trustee or responsible officer of a superannuation entity. The Act mandates that any such actions by a disqualified person constitute an offence, as outlined in section 126K. Additionally, the disqualification notice, which includes details of the decision and the reasons for it, must be published as a Notifiable Instrument in the Federal Register of Legislation, as per subsection 126A(7). The consequences of breaching the disqualification provisions are severe. Section 126K imposes a maximum penalty of two years imprisonment for any disqualified person who knowingly acts in a prohibited capacity. This strict penalty underscores the seriousness with which the Act treats non-compliance. Furthermore, the Act provides avenues for recourse, including the ability to apply for revocation of the disqualification under subsection 126A(5), either on the initiative of the Commissioner or by the disqualified person themselves. In the event that Chantell Hagen is dissatisfied with the disqualification decision, she has the right to request the Commissioner to reconsider it within 21 days of receiving the notice, as stipulated in section 344 of the SISA.