Australian Securities & Investments Commission review finds 62% of SMSF establishment advice files lacked best interests duty evidence and weighs enforcement action

The Australian Securities & Investments Commission published findings from a review of personal advice to retail clients on establishing self-managed super funds (SMSFs), identifying widespread shortcomings in advisers’ ability to demonstrate compliance with the best interests duty and a material set of cases raising concerns about potential client detriment. ASIC said it is considering a range of regulatory responses, including enforcement action, where it has significant concerns about poor and unacceptable advice. ASIC assessed 100 advice files on recommendations to establish an SMSF or make an initial rollover, finding 62 files did not demonstrate best interests duty compliance and 27 raised significant concerns about client detriment, while 38 files demonstrated compliance. Control frameworks were also questioned: 33 of 47 files that recorded pre-vetting still indicated a failure to comply with the best interests duty, and in 24 of the 27 detriment cases ASIC was concerned the adviser failed to prioritise the client’s interests over their own or those of their licensee or associates. The report also reviews policies and procedures across 12 advice licensees, and sets out eight action points for advisers and four for licensees, against a backdrop of an SMSF sector of around AUD 1 trillion and 41,980 new funds established in the year to June 2025.