Slater and Gordon is launching a full-on assault on Australia's financial institutions in a campaign to secure more than one billion dollars in super from the banks.
Their campaign is called Get Your Super Back and it is shaping up to be an intensive, lengthy, and expensive battle.
"Slater and Gordon will take on the banks on behalf of millions of Australians whose super funds may have been gouged by bank-owned super funds lining their pockets, through a series of class actions," says Slater and Gordon in a media release.
The law firm's first targets are Commonwealth Bank-owned superannuation fund Colonial First State and AMP.
The firm will allege the big bank-backed super funds failed to obtain for members competitive cash interest rates on cash option funds and charged exorbitant fees.
The firm says that one third of all adult Australians may be eligible to join these class actions which could potentially secure over $1 billion in payouts.
Slater's suite of class action suits arise from the revelations at the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry.
Slater and Gordon Head of Class Actions Ben Hardwick said the fee gouging and paying out of un-competitive interest rates for Australians who hold part of their super in cash option funds may have set back the quality of retirement for many Australians.
"This means that millions of Australians may be out of pocket and a handful of banks have lined their pockets," says Hardwick.
"What funds like Colonial First State have been doing is dumping super with a parent bank such as CBA. The interest from the parent bank is so low that investors in the cash option are receiving rates as low as 1.25% a year. This is even below the RBA cash rate."
"In the Royal Commission, it was revealed that some AMP super fund members were getting negative returns on the cash held for them by AMP."
"We don't believe there is any justification for a bank-owned fund member being worse off than industry fund members, especially when they have chosen to invest in a passive cash investment option, which requires the fund to do basically nothing."
"We think retail fund members should be compensated for the difference between their returns on cash, and the returns they should have received if the trustee had done their job properly. Industry funds have demonstrated the return that should be produced on cash investments when a proper effort is made by the trustee to secure the best available interest rate."
"Some of the bank-owned super funds have broken this trust with Australians. It's been about lining their own pockets: about propping up their profits and undermining the entire scheme."
The Get Your Super Back campaign is yet another class action brought by Slater and Gordon this year.
Most notably, the company became the fourth Aussie law firm to launch a class action against disgraced financial services provider AMP in June.
The company also announced in April that it was going ahead with a class action against one of Australia's largest milk suppliers, Murray Goulburn, alleging that the company misled its investors.
Shares in Slater and Gordon have soared off the back of today's announcement, up 19.18 per cent to $2.92 per share at 1.41pm AEST.
Business News Australia