Imagine waking up to a call from a stranger, promising to help you grow your retirement savings. It sounds too good to be true, and for many, it is. This is the reality of 'lead generators' in the superannuation industry, a practice that has sparked a review by ASIC, the Australian Securities and Investments Commission.
Meet Liz, a woman who received such a call. She was initially seeking financial advice but soon found herself in a web of concern and uncertainty. The salesman, claiming to be from Clear Sky Financial, offered her a seemingly harmless piece of advice: move her retirement savings from a regulated fund to a less-regulated scheme. But Liz's instincts kicked in, and she began to question the motives behind this unsolicited advice.
Clear Sky Financial, with its impressive $540 million in assets under management, is licensed under InterPrac, an entity currently under investigation by ASIC. This investigation is linked to the collapses of Shield and First Guardian, which put 12,000 Australians at risk of losing over $1 billion in retirement savings.
InterPrac, while maintaining its commitment to ethical practices, has ceased its use of lead generation services. Clear Sky, a financial planning firm licensed with InterPrac, has also stopped using lead generators to build its client base, following a notice issued by InterPrac in December 2025, prohibiting its financial advisers from using such firms for marketing purposes.
ASIC's review involves publishing a list of known lead generators, referral partners, and advice licensees who have acquired leads since July 2024. This list is a warning to consumers, highlighting the potential risks associated with these entities.
"We're doing this work because we've seen the significant harm that can come from lead generation in relation to superannuation switching," said ASIC Commissioner Alan Kirkland.
And the harm is extensive. Thousands of consumers have been lured in by social media ads and a series of persuasive phone calls, often misled about their current super fund's performance. They've been convinced to switch their superannuation to high-risk investments, resulting in the loss of their entire retirement savings.
ASIC's review aims to address these 'inappropriate' practices. The regulation of major superannuation funds in Australia is overseen by APRA, but with over $1 trillion now in self-managed superannuation funds, ASIC is the sole investment watchdog protecting consumers.
Mr. Kirkland emphasized the legal obligations of licensees, stating that financial advice must be in the client's best interests and that the client's interests should always come before those of the advisor or licensee.
ASIC has already taken legal action against one lead generation firm, Imperial Capital Group, and is prepared to use all available enforcement tools if further serious harm is identified.
Lead generators often receive 'marketing fees' from licensed financial advisers for generating leads. This was the case with the First Guardian and Shield managed investment schemes, which later collapsed. Consumers, after being contacted by sales representatives from various lead generation companies, moved significant amounts of their super savings from APRA-regulated funds to these schemes, only to face little prospect of recovery when the funds collapsed.
Liz's experience is a cautionary tale. She recalled the pushy tactics of the salesman, who pressured her to make an immediate decision. She also remembered the salesman's boast about a team member who had appeared on the TV show 'MAFS'.
ASIC has urged consumers to look out for 'red flags', such as feeling pressured to act immediately or being told that their existing fund is underperforming. Often, these calls are a result of clicking on social media ads or filling out forms on super comparison websites. Lead generators may offer free 'super health checks' or help find lost super, but consumers should be wary of these tactics.
Mr. Kirkland advised consumers to hang up on unsolicited calls if they feel pressured. He warned about the involvement of unlicensed people in the advice process, limited contact with licensed financial advisers, poor product disclosure, and promises of high or unrealistic returns.
Super Consumers Australia is calling for a ban on lead generation for superannuation and financial advice, as well as closing the loophole that allows 'cold calling' offering financial advice. Chief Executive Xavier O'Halloran believes these schemes prey on people who are simply trying to do the right thing with their superannuation.
"The cost of poor consumer protections is currently falling on everyone," said Mr. O'Halloran. "Super is often people's second biggest source of wealth, and the consumer protections need to reflect that."
ASIC's review is a step towards addressing these regulatory gaps and protecting consumers from the harmful practices of lead generators in the superannuation industry.
