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11 May 2011

359  MR FLETCHER: To ask the Assistant Treasurer—In respect of the activities of the Australian Prudential Regulation Authority (APRA), has APRA undertaken any reviews or investigations from 2007 onwards into the investment operations of the Local Government Superannuation Scheme Pty Ltd (LGSS) (ABN 68078003497), including the purchase by the LGSS of securities known as ‘Rembrandt’ notes; if so, (a) what is the nature of the reviews or investigations, (b) what powers was APRA exercising in undertaking the reviews or investigations, (c) what were the findings and the outcome of the reviews or investigations, (d) were any adverse findings made against actions of the LGSS, and (e) has any follow-up action been taken by APRA on the reviews or investigations.

361  MR FLETCHER: To ask the Assistant Treasurer—In respect of the investigation being undertaken by the Australian Securities and Investments Commission (ASIC) into the collapse of Trio Capital Ltd and the APP growth fund, did investors act on advice from licensed financial advisors; if so, can he indicate (a) the actions ASIC has taken against such advisors, (b) whether these advisors had professional indemnity insurance (as required under s 912B of the Corporations Act 2001 ), and if they did not, why not, (c) whether ASIC is taking action against advisors with a view to recovery against their professional indemnity insurance, (d) what action can be taken against any advisors who acted without such insurance, but before the legal requirement to have this insurance was imposed, and (e) what proportion of lost assets resulted from advisors or Trio Capital Ltd behaving fraudulently, versus negligently.

362  MR FLETCHER: To ask the Assistant Treasurer—-In respect of the investigation being undertaken by the Australian Securities and Investments Commission (ASIC) into the collapse of Trio Capital Ltd and the APP growth fund, specifically in relation to investments by self managed superannuation funds, did Trio Capital Ltd have professional indemnity insurance (as required under s 912B of the Corporations Act 2001 ); if not, why not, and what action can be taken against Trio Capital Ltd for any conduct dated (a) before, and (b) after, the legal requirement to have professional indemnity insurance was imposed; if so, is ASIC taking action against Trio Capital Ltd with a view to recovery against its professional indemnity insurance.

363  MR FLETCHER: To ask the Assistant Treasurer—-In respect of the consultation paper Review of compensation arrangements for consumers of financial services: future of financial advice (Richard St. John, April 2011), (a) why does the paper provide little discussion or analysis as to why the Australian Prudential Regulation Authority-regulated superannuation funds are subject to a statutory compensation scheme (provided under Part 23 of the Superannuation Industry (Supervision) Act 1993 ) yet self managed superannuation funds are not, and (b) will he consider seeking advice and publishing a consultation paper on this important and topical issue, particularly in light of the collapse of Trio Capital Ltd resulting in many investors in self managed superannuation funds losing substantial superannuation savings; if not, why not.