I noted with interest the Australian Securities and Investments Commission (ASIC) has commenced penalty proceedings against the Construction and Building Unions Superannuation Fund (CBUS).
ASIC alleges CBUS failed to act efficiently when CBUS handled claims being made for Death Benefits.
ASIC asserts CBUS failed its members at their most vulnerable time.
I certainly agree delays in family members being able to receive Death Benefits following the loss of a loved one causes significant distress.
A Trustee of a Superannuation Fund has an obligation to pay a member’s entitlements as soon as practicable after their death.
The ASIC proceedings highlight the importance of making sure you have, as part of your estate plan, arrangements with respect to your superannuation in place.
Typically, a member can give a direction to the Trustee through a Binding Death Benefit Nomination (‘BDBN’) as to how their Death Benefits are to be paid.
If you don’t have a BDBN in place, the payment of your Death Benefit is left to the discretion of the Trustee.
By leaving matters to the discretion of a Trustee, you can significantly delay the payment of your Death Benefit.
A BDBN removes the Trustee’s discretion and gives certainty as to whom benefits are to be paid.