16 Oct 1414 Federal Court imposes pecuniary penalties on directors of super trustee - Graham
The Federal Court (Buchanan J) has imposed pecuniary penalties of $30,000 and $10,000 respectively on the two directors of a company acting as trustee of a superannuation fund.
The two directors caused the trustee company to make 80 loans to themselves as members of the Graham Family Superannuation Fund (“the Fund”) in the total sum of $134,418.62 without authorisation and in contravention of ss 62, 65, 84 and 109 of the Superannuation Industry (Supervision) Act 1993 ("SIS Act"). Further, the two directors caused the trustee company to lease residential property belonging to the Fund to a relative, namely the son, of the two directors and failed to collect rent in accordance with the terms of the lease without authorisation and in contravention of ss 62, 84 and 109 of the SIS Act.
The two directors admitted the contraventions and agreed with the Commissioner as to the level of penalties. The Court was satisfied that the penalties were within the proper range of penalties appropriate to the circumstances.
The Court noted that the Fund was not declared non-complying by the Commissioner. However, the Commissioner disqualified the two directors from acting as a trustee, investment manager or custodian of a superannuation entity under s126A(2) of the SIS Act.
Deputy Commissioner of Taxation (Superannuation) v Graham Family Superannuation Pty Limited  FCA 1101 (Federal Court, Buchanan J, 15 October 2014).