Super investors were misled: court
Superannuation provider Colonial First State has been found to have misled thousands of customers over whether they should choose a low fee product.
The Federal Court has found Colonial made false or misleading statements about staying in its FirstChoice Fund or switching to the simpler alternative.
This included telling customers that changes to laws meant Colonial had to ask their permission to keep them in the FirstChoice Fund. This was not the case.
The communication followed the requirement from 2012 for all superannuation providers to offer a simple, low fee product called MySuper.
Colonial made these misleading communications at least 12,978 times through letters and calls between 2014 and 2016.
Australian Securities and Investments Commission deputy chair Sarah Court said Colonial's actions may have led members to keep their funds in higher fee-paying products.
Colonial said it apologised unreservedly. Compensation to customers is more than 99 per cent complete.
Colonial First State is owned by the Commonwealth Bank of Australia.
The court will begin deciding on penalties at a hearing on October 12.