Major super fund Cbus is forced to apologise after being accused of disgraceful $20million act
Pension giant Cbus has apologized after the regulator accused the company of failing to process $20 million worth of death and disability claims in a timely manner.
The Australian Securities and Investments Commission has taken the fund to the Federal Court, saying the failure to pay more than 10,000 claims in less than 90 days has caused real harm to members and their families.
It also claimed that by the end of 2022, more than 6,000 claims had been deferred by more than 12 months, more than half of the fund’s claims at the time.
“We allege that Cbus failed its members and claimants at their most vulnerable time,” ASIC deputy chair Sarah Court said.
“We are taking this case to protect all those vulnerable Australians trying to access the financial support they are entitled to.
‘This contributes to difficult personal circumstances, whether grieving a loved one or dealing with serious injury or illness… the additional fear and pain these delays caused exacerbated the problems faced by these sufferers and their families were confronted.”
In response, Cbus apologized and said it had initiated a compensation scheme for affected members.
It said it had cooperated with ASIC’s investigation and would seek to settle the case out of court.
“Cbus Super regrets that there have been delays in processing insurance claims from our members,” a statement from the company said.
“Unfortunately, this has increased the suffering of members and their families.”
It also claimed that by the end of 2022, more than 6,000 claims had been deferred by more than 12 months, more than half of the fund’s claims at that time (stock image pictured)
‘Cbus has implemented a number of measures to reduce delays and is committed to further improving insurance claims management.’
ASIC alleged that Cbus failed to report the breaches to them within 30 days of becoming aware of them, as required by law.
It also said Cbus had failed to ensure the final breach report was not false or misleading.
ASIC said it would seek sanctions, declarations, negative publicity orders and compliance orders through the courts.
Cbus, which is affiliated with a number of unions including the CFMEU, serves more than 920,000 people and manages $94 billion in assets, according to its website.