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Fraudsters Target Super Funds

Date: February 11, 2013 Author: admin Category: Latest News Tags: , , , , , Comments: 0

SELF-managed superannuation funds holding billions of dollars and companies with inadequate anti-hacking technology have become major targets for fraudsters, according to specialist audit firm WPIAS.

The Oxenford-based practice expects an avalanche of cases to flow from technology failings and the growth in self-managed super funds.

It has appointed Lisa Bundesen, a forensic accounting specialist, to help deal with the growth in fraud cases.

The practice says companies with poor anti-hacking software are becoming the target of overseas crime syndicates, while super funds are at the mercy of dodgy advisers, and of mum-and-dad operators wanting to put savings to an unauthorised use.

Ms Bundesen is a former investigative accountant with the Queensland Police Fraud and Corporate Crime Investigation Group.

She also has held senior positions with BDO and PPB Advisory, and has conducted many high-profile fraud investigations.

WPIAS managing partner Reg Williams said Ms Bundesen's experience would be invaluable in the firm's forensic investigations and in working with businesses to minimise opportunities for fraud.

Mr Williams said the massive growth in self-managed superannuation funds had made them a prime target for fraud.

There are now around 500,000 funds in Australia and, after real estate, the second most popular investment for the funds is cash.

"The growth in these funds is unprecedented and there are billions of dollars in cold, hard cash in their accounts," Mr Williams said.

"The temptation is there to make unauthorised use of it. We have just had a case of self-managed super fund fraud where mum and dad investors were in desperate need of a substantial sum of cash to pay their firm's wages.

"They took money from their own fund and then falsified the records. The money should have been there to pay for their retirement.

"They now run the risk of losing the fund's assets and being prosecuted and possibly jailed."

Mr Williams said the number of unscrupulous advisers in control of the funds was on the increase. "We are seeing a lot more unauthorised trading, particularly in high-risk derivatives, by advisers who are being paid commissions," he said.

Ms Bundesen said changes in technology meant many businesses were failing to keep up with Australian and overseas criminals committing fraud.

Police and forensic accountants are dealing with a rise in extortion cases, such as the ransom bid last year by a Russian crime syndicate which hacked into a Miami medical centre's files and demanded $4000 for the return of files.

"Given the state of the economy, we are seeing a lot more of that type of professional fraud," Ms Bundesen said.

"It happens mostly to small businesses because they have weaker controls on their technology."


Jenny Rogers

February 11, 2013

Gold Coast Bulletin

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