Australian taxpayers should be aware that some promoters claim to offer early access to super savings by transferring a person’s super into a self-managed super fund.
These schemes are illegal and heavy penalties will apply to those who participate in such schemes.
Generally, individuals cannot access their super until they retire or meet a condition of release.
Some people promoting illegal super schemes will say that they can help access a person’s super now to pay off credit card debt, buy a house or car, or go on holiday. These schemes are illegal and may cost those who engage in them a lot more than the super they access.
Illegal super schemes usually involve a promoter offering to help a person access their super early. Promoters of illegal super schemes usually:
- encourage people to transfer their super from their existing super fund to a self-managed super fund (SMSF)
- target people who are under financial pressure or who do not fully understand Australian superannuation laws
- claim that a person’s super can be used for anything (which is not true)
- charge high fees and commissions
Those who participate in one of these schemes may become a victim of identity theft. Identity theft happens when someone uses another person’s personal details to commit fraud or other crimes. Once a person’s identity has been stolen and misused, it can take years to fix.