Notice of Disqualification – Sushil Devkota – 3 June 2025

Overview

The Superannuation Industry (Supervision) Act 1993 (SISA) was enacted to regulate the superannuation industry in Australia, ensuring that superannuation funds are managed efficiently, transparently, and in the best interests of members. The Act addresses the need for a robust regulatory framework to protect the retirement savings of Australians by establishing a licensing regime for trustees, investment managers, and custodians of superannuation entities. The SISA was introduced by the Australian Parliament to provide a comprehensive set of rules governing the operation of the superannuation industry, including provisions for the disqualification of individuals who fail to comply with the Act's requirements. The policy objective of the SISA is to maintain the integrity and stability of the superannuation system, safeguarding the retirement benefits of members through stringent regulatory oversight and enforcement actions against non-compliant entities and individuals.

Scope and Application

The Superannuation Industry (Supervision) Act 1993 (SISA) applies to individuals and entities involved in the management and oversight of superannuation funds within Australia. The act targets trustees, investment managers, custodians, responsible officers, and body corporates that engage in activities related to superannuation entities. It extends its jurisdiction nationally, applying to all states and territories within the Commonwealth of Australia. The act aims to ensure the integrity and proper management of superannuation funds by disqualifying individuals who contravene its provisions. The disqualification can be imposed for multiple contraventions, which provide sufficient grounds for such action. Notably, once a person is disqualified, they are prohibited from acting in any capacity that involves managing or overseeing superannuation funds, with severe penalties for non-compliance. Additionally, the act provides mechanisms for the revocation of disqualification and avenues for reconsideration of decisions, ensuring due process and fairness.

Key Provisions

The Superannuation Industry (Supervision) Act 1993 (SISA) outlines the main provisions for the disqualification of individuals involved in the supervision of superannuation funds. Specifically, under subsection 126A(6), an individual may be disqualified if it is determined that they have contravened the SISA on one or more occasions to a degree that warrants disqualification. This process was followed in the case of Sushil Devkota, who was formally notified of his disqualification by Emma Rosenzweig, a delegate of the Commissioner of Taxation, on 3 June 2025. Sushil Devkota was notified that his disqualification was effective from the date of the notice, as per the terms of the Act. The obligations imposed by the SISA on individuals like Sushil Devkota include refraining from acting in any capacity that involves the management or administration of superannuation entities. This includes roles such as trustee, investment manager, or custodian of a superannuation entity, as well as responsible officer or body corporate in such capacities. These roles are crucial in ensuring the proper management and oversight of superannuation funds, and the SISA aims to maintain the integrity and reliability of these roles by disqualifying those who have breached the Act. Breaching the SISA by continuing to act in any capacity outlined in the disqualification notice is an offence under section 126K of the Act. Specifically, it is an offence for a disqualified person to be, or act as, a trustee, investment manager, or custodian of a superannuation entity, or to be a responsible officer or body corporate in such roles. The maximum penalty for this offence is two years in jail, underscoring the seriousness with which the Act treats such breaches. This penalty serves both as a deterrent against non-compliance and as a means of enforcing the Act's regulatory framework. The SISA also provides avenues for individuals to seek reconsideration of a disqualification decision. Under section 344, if an individual is affected by a disqualification decision and believes it to be incorrect, they can request the Commissioner to reconsider the decision. This request must be made in writing within 21 days of receiving notice of the decision and should include the reasons why the individual believes the decision is wrong. Additionally, under subsection 126A(5) of the SISA, the disqualification may be revoked either on the initiative of the Commissioner or following a written application by the disqualified individual, providing a potential path to reinstatement under certain conditions.