Cbus pushes for lead generator ban

Cbus Super has renewed calls for a ban on superannuation lead generation activity, warning sophisticated digital marketing tactics are increasingly being used to pressure Australians into switching retirement savings into higher risk and less regulated products.

The industry fund said new research found almost one in three members recall being targeted by lead generation tactics over the past year, with younger tradies identified as a key demographic for operations using social media advertising, comparison surveys and algorithm driven targeting.

Cbus chief executive Kristian Fok said the activity represented a growing threat to confidence in superannuation system and should be outlawed.

"Compulsory superannuation is the envy of the world and utterly vital for everyday Australians to build a comfortable retirement, but that only works if they can have trust in the system" Fok said.

The fund said lead generators had emerged as a workaround following the post Banking Royal Commission ban on cold-call sales for super and financial advice. Operators instead rely on online mechanisms to harvest personal data and funnel consumers toward super switching and investment products.

Cbus argued the practice was contributing to consumer harm, pointing to the collapse of the Sheild and First Guardian funds, where more than 11,000 Australians collectively lost over $1 billion after many were persuaded to invest after clicking on lead generator advertising.

Fok said the activity often blurred the line between product promotion and legitimate financial advice.

"It's product-pushing masquerading as genuine financial advice," he said.

The fund has lodged a submission to the federal government's consultation on curbing lead generation activity, calling for both a ban on superannuation lead generation and restrictions on purchasing consumer leads linked to retirement saving products.

Cbus also called for stronger regulatory intervention powers, warning many Australians remain unable to distinguish between legitimate super products and high-risk or misleading offerings.

The renewed push comes amid heightened regulatory scrutiny across the advice and superannuation sectors following several high-profile investment collapses and ongoing concerns around consumer protection.