Notice of Disqualification – Derek Read - 2 June 2026

Overview

The Superannuation Industry (Supervision) Act 1993 (SISA) was enacted to provide a regulatory framework for the supervision of the superannuation industry in Australia. The primary problem it addresses is ensuring the integrity and proper management of superannuation funds by establishing clear guidelines and oversight mechanisms. This Act was introduced by the Commonwealth Parliament, aiming to protect the interests of superannuation fund members by enforcing compliance with stringent regulatory standards. The policy objective is to maintain the financial stability and ethical conduct of entities within the superannuation sector, thereby safeguarding the retirement savings of Australians. The SISA includes provisions for the disqualification of individuals who have acted in breach of the Act's requirements, as exemplified by the notice of disqualification issued to Derek Read, ensuring that those responsible for corporate trustees' non-compliance face appropriate consequences.

Scope and Application

The Superannuation Industry (Supervision) Act 1993 (SISA) applies to individuals and entities involved in the administration of superannuation funds in Australia. Specifically, it targets responsible officers of corporate trustees of superannuation entities, including trustees, investment managers, and custodians. The Act extends to the entire Commonwealth of Australia, ensuring a national scope of regulation over superannuation practices. The Act also includes provisions for disqualifying responsible officers who are involved in repeated contraventions of the Act, thereby safeguarding the interests of superannuation fund members. Exclusions or exemptions are not broadly defined within the Act itself but may be specified through subordinate instruments or specific provisions addressing particular entities or conduct. Additionally, the Act allows for the revocation of disqualifications under certain conditions, providing a mechanism for rectification if warranted. The geographic reach of the Act is comprehensive, applying to all superannuation entities and their responsible officers across Australia, ensuring uniform regulation and oversight.

Key Provisions

The primary operative sections of the Superannuation Industry (Supervision) Act 1993 (SISA) in this context include subsection 126A(2), which empowers the Commissioner of Taxation to disqualify an individual from being a responsible officer of a corporate trustee of a superannuation entity if certain conditions are met. Specifically, subsection 126A(6) mandates that the Commissioner must provide a written notice of disqualification to the individual. This was executed on 2 June 2026, where Derek Read was disqualified by Ben Kelly, a delegate of the Commissioner of Taxation. The disqualification is effective from the date it is issued, reflecting the immediate impact of the decision. The Act imposes significant obligations on the parties involved. For Derek Read, the disqualification means he is prohibited from acting as a responsible officer of any corporate trustee of a superannuation entity. This restriction is designed to prevent individuals who have been found to have contributed to breaches of the SISA from continuing to influence or manage superannuation entities. The Act also requires the Commissioner of Taxation to publish details of the disqualification as a Notifiable Instrument in the Federal Register of Legislation, ensuring transparency and public accountability. Further, the SISA imposes specific legal obligations and consequences for breaches. Under section 126K, it is an offence for a disqualified person to act, or attempt to act, as a trustee, investment manager, or custodian of a superannuation entity, or to be a responsible officer of such a body corporate. The penalty for contravening this provision is severe, with a maximum punishment of two years imprisonment. This stringent penalty underscores the importance of compliance with the SISA and the seriousness with which the law treats breaches of these provisions. In addition to the criminal penalties, the Act provides a mechanism for review. Section 344 allows any person affected by the disqualification to request the Commissioner to reconsider the decision if they believe it to be incorrect. This request must be made in writing within 21 days of receiving notice of the disqualification and must include the reasons for the perceived error in the decision. This provision ensures that individuals have an opportunity to challenge the decision and seek redress if they believe it was made in error.