Super giant Cbus has apologised after the corporate regulator accused it 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 genuine harm to members and their families.
It also alleged more than 6000 claims had been delayed more than 12 months by late 2022, more than half the fund's claims at that time.
“We allege Cbus failed its members and claimants at their most vulnerable time, and we are taking this case to protect all those vulnerable Australians trying to access the financial support to which they are entitled,” ASIC deputy chair Sarah Court said.
“This adds to difficult personal circumstances, whether grieving for a loved one or dealing with severe injury or illness … the additional anxiety and pain these delays caused compounded the issues these members and their families faced."
In response, Cbus apologised and said it had started a compensation scheme for affected members.
It said it had cooperated with ASIC's investigation and said it would seek to settle the matter outside court.
“Cbus Super is sorry that delays have been experienced in the processing of insurance claims made by our members … regrettably this has added to the distress of members and their families,” a company statement said.
“Cbus has implemented a number of measures that are reducing delays and is committed to further improving management of insurance claims."
ASIC claimed Cbus did not report the breaches to them within 30 days when it became aware of them, as required by law.
It also said Cbus failed to ensure its eventual breach report was not false or misleading.
ASIC said it would seek penalties, declarations, adverse publicity orders and compliance matter orders through court.
Cbus, which is linked with a number of unions including the CFMEU, serves more than 920,000 and manages $94 billion in assets according to its website.
