Posted on 10 Oct 2018
Massive class action filed against Commonwealth Bank and Colonial First State, as Slater and Gordon’s ‘Get Your Super Back’ campaign clicks into gear.
Slater and Gordon has today filed the first class action of its ‘Get Your Super Back’ campaign: a claim against the Commonwealth Bank and Colonial First State that could exceed $100 million and include hundreds of thousands of superannuation members. The case will be funded by Augusta Ventures Limited, one of the largest global litigation funders.
The class action was filed in the Federal Court on behalf of the lead applicant, Keith Kayler-Thomson, and many thousands of other Colonial First State members.
The action will allege Colonial First State invested the retirement savings of its members with its parent bank, the CBA, where it received uncompetitive bank interest rates.
“We will allege that by dumping members’ super with its parent bank, the CBA, Colonial First State failed to obtain the most competitive interest rate available for its members invested in cash-only investment options and balanced options where there is a cash component,” said Slater and Gordon Head of Class Actions Ben Hardwick.
“The class action will allege there is no excuse for Colonial First State to have accepted such a low rate from CBA when it could have easily obtained a higher rate – either from the CBA or from any other bank.
“A superannuation fund trustee is obligated to act in the best interests of its members, not its parent company. That’s the law. This class action will allege Colonial First State placed the interests of its members beneath the interests of the Commonwealth Bank.
“CBA has been paying some Colonial members rates as low as 1.25 per cent, below even the RBA cash rate at 1.5 per cent. If CBA had paid just an extra 0.5 per cent per annum to a member with $100,000 in cash, that member would have earned an additional $2,235 over five years.
“We think hundreds of thousands of Australians are potentially eligible to get their money back from Colonial First State and the Commonwealth Bank.
“In some circumstances, the amounts may seem relatively small. But this is money that was hard-earned by working Australians and it’s time they got it back.”
Lead plaintiff, Mr Kayler-Thomson, said he could not believe how blatant the unethical behaviour appeared to be.
“These are my retirement savings we’re talking about. I assumed that a big institution like Colonial could be trusted to act ethically and within the law,” Mr Kayler-Thomson said.
“I’m angry. You can bet that if I owed Colonial or the Commonwealth Bank money they wouldn’t hesitate to force me to pay it back and they should do the same. I'd bet thousands of other Colonial members will feel exactly the same way.”
Current and former members of FirstChoice Personal Super, FirstChoice Pension, FirstChoice Wholesale Personal Super, FirstChoice Wholesale Pension, and FirstChoice Employer Super who are or were invested in the FirstRate Saver investment option, may be eligible to participate in the class action. Current and former members of Commonwealth Essential Super, who are or were invested in the Cash Deposit, Balanced and Lifestage investment options, may also be eligible to take part.
Slater and Gordon recently launched the ‘Get Your Super Back’ campaign in the wake of the Financial Services Royal Commission.
“Anybody who thinks they could be eligible to participate in this or related class actions against bank-owned super funds should register their interest at getyoursuperback.com,” Mr Hardwick said.