Australian Taxation Office’s tough new rules will slow processing of early access to super applications
Tougher checks will be implemented in the early access to super scheme to stamp out fraudsters, meaning longer processing times for applicants.
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Tougher checks will be implemented in the early access to super scheme to stamp out fraudsters, meaning longer processing times for applicants.
The move by the Australian Taxation Office announced on Monday comes just several days after the scheme came to an abrupt hold following identity fraud being detected.
An investigation by the Australian Federal Police put a stop to the processing of claims last Friday but that has since resumed.
The ATO said it would continue to hand over batches of daily files to super funds however it would take longer to do this as more stringent checking was implemented.
In an alert sent to funds on Monday the ATO said the following:
“Funds will continue to receive daily files however they will be one business day later than the previous process,” the note to funds said.
Latest data from the Australian Prudential and Regulation Authority showed as of May 3 the average payment processing time was 3.1 days after receiving an application by the ATO.
However the delays in applicants getting their money quickly has been a point of contention – many have complained they have been forced to wait weeks.
Under the current guidelines funds should hand over the money to applicants within five business days of receiving their paperwork.
Files that were approved last Thursday, but paused on Friday during the AFP investigation, would not have been delivered back to the fund until Monday.
An additional second “additional information file” will be created for any member that has a red flag appear against their application.
Latest figures show 1.242 million applications for early access to super have been given the green light by the ATO totalling $10.2 billion.
The average withdrawal is $8211.
Under the scheme Australians can access $10,000 this financial year and another $10,000 next financial year.
The ATO halted the scheme last Friday – it was understood about 150 applications were impacted in relation to about $120,000 in retirement savings and linked to one accountant.
Mother-of-three Andrea Dunn had $10,000 stripped from her Sunsuper account last month without her consent.
The 54-year-old from Drouin in Gippsland, Victoria, received a text message last month purporting to be from the ATO saying a new myGov had been set up in her name.
Then the following day she received an email from her super fund saying $10,000 had been successfully transferred to a bank account.
This is despite Mrs Dunn never having set up a new myGov account nor applying to access her super early.
“I feel violated and concerned and angry that it will happen to others,” she said.
“My concern now is there’s someone pretending to be me and they’ve set up a bank account in my name.”
She reported the fraud to the ATO, her super fund and Suncorp where the stolen money was deposited.
On Friday she was told by her super fund after waiting three weeks – and after News Corp contacted them – that the money would be returned to her account within a few days.
Assistant Treasuer Michael Sukkar said the ATO had identified a small number of third parties who could be suspectible to criminal activity.
“The ATO is working with these third parties to help them make security enhancements,” he said.
He urged Australians to protect their personal information at all times to reduce any chance of fraud.
“Australians should never share their myGov log-in with anyone, including their tax agent, and be wary of emails or text messages that request personal information,” Minister Sukkar said.
The Australian Institute of Superannuation Trustees’ chief executive officer Eva Scheerlinck said she welcomed tougher checking of applications.
“We support the ATO implementing any additional upfront checks and balances it may need to take to improve the security of the system,” she said.
“Once the ATO sends approved files to the super funds, applications will be processed as quickly as possible.”
The ATO said if you think someone has stolen or misused your identity to contact their Client Identity Support Centre on 1800 467 033.
Originally published as Australian Taxation Office’s tough new rules will slow processing of early access to super applications
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