Notice of Disqualification – David Piers Hammett - 7 October 2024

Overview

The Superannuation Industry (Supervision) Act 1993 (SISA) was enacted by the Australian Parliament to address the need for a robust regulatory framework governing the superannuation industry, particularly focusing on the oversight and management of superannuation entities to protect the interests of superannuation members. The legislation was introduced to fill a critical gap in ensuring that trustees, investment managers, and custodians of superannuation funds operate with the highest standards of accountability and integrity. The Act aims to safeguard the superannuation savings of Australians by establishing clear regulatory requirements and enforcement mechanisms. In this context, the Act empowers the Commissioner of Taxation to disqualify individuals from acting in certain capacities within the superannuation industry if they are found to have engaged in conduct that justifies such action. The policy objective is to deter non-compliance and maintain the integrity of the superannuation system by removing individuals from positions of responsibility where there has been a serious breach of the law.

Scope and Application

The Superannuation Industry (Supervision) Act 1993 (SISA) applies to individuals and entities involved in the management and oversight of superannuation entities in Australia. Specifically, the Act imposes obligations on trustees, investment managers, and custodians of superannuation entities, as well as responsible officers of corporate trustees. The Act operates on a national level, applying across all states and territories within the Commonwealth of Australia. The SISA provides for the disqualification of individuals who have been responsible officers of corporate trustees that have contravened the Act, where the seriousness of the contraventions justifies such a measure. The disqualification prohibits the disqualified person from acting as a trustee, investment manager, or custodian of a superannuation entity or being a responsible officer of such a body. This disqualification can be initiated by a delegate of the Commissioner of Taxation and, once in effect, is published as a Notifiable Instrument in the Federal Register of Legislation. The Act also provides for the possibility of revocation of the disqualification under certain conditions and outlines the right of appeal for those dissatisfied with the disqualification decision.

Key Provisions

The notice of disqualification issued to David Piers Hammett under subsection 126A(6) of the Superannuation Industry (Supervision) Act 1993 (SISA) informs him that he has been disqualified from acting as a responsible officer of a superannuation entity. This disqualification arises because it has been determined that the corporate trustee of one or more superannuation entities has breached the SISA on one or more occasions, and David was a responsible officer at the time of these breaches. The seriousness of these contraventions provides sufficient grounds for the disqualification. According to the notice, the disqualification takes effect immediately upon its issuance on 7 October 2024. The obligations imposed on David Hammett by this disqualification are significant. Under section 126K of the SISA, it is an offence for a disqualified person who is aware of their disqualification to serve or act as a trustee, investment manager, or custodian of a superannuation entity, or to be a responsible officer of a body corporate that holds such roles. This means that David is legally prohibited from participating in any capacity that involves the management or oversight of superannuation entities. This prohibition is intended to prevent further breaches and to protect the interests of superannuation fund members. The consequences for breaching these obligations are severe. Section 126K of the SISA stipulates that knowingly acting in a prohibited capacity while disqualified is an offence that carries a maximum penalty of two years imprisonment. This reflects the seriousness with which the law views repeated or significant breaches of superannuation regulations. Additionally, the notice indicates that the details of the disqualification will be published as a Notifiable Instrument in the Federal Register of Legislation, ensuring transparency and public accountability. David Hammett has the right to seek reconsideration of the disqualification decision under section 344 of the SISA. If he is dissatisfied with the decision, he can request the Commissioner to reconsider it in writing within 21 days of receiving the notice. Furthermore, under subsection 126A(5) of the SISA, the disqualification may be revoked either on the initiative of the Commissioner or upon David’s written application, providing a potential pathway for reinstatement under certain conditions.