SMSF scheme sees creator jailed

A 51-year-old was found to have unlawfully created, operated and benefitted from a fraudulent self-managed superannuation fund.

Kent Nguyen was sentence to three years in prison after pleading guilty to orchestrating an illegal early release of a superannuation scheme, with the court finding the fund did not comply with relevant protocol, procedures and requirements of superannuation legislation.

Between 2007 and 2009, Nguyen used the fund, called Tot Form Super Fund, to arrange the unlawful early release of superannuation funds for a 25 people, many of whom were in financial trouble.

Over $700,000 was illegally withdrawn after each individual's super balance was rolled over from a retail super fund to the Tot Form Super Fund.

Nguyen kept a significant portion of the funds, telling the victims that the money was paid to the Australian Taxation Office.

ATO Assistant Commissioner Ian Read said the sentence handed down demonstrates that promoters who encourage illegal early access to superannuation will be held accountable.

"While the majority of SMSFs do the right thing, this case serves as a reminder that there are severe penalties for those who attempt to cheat the system," Read said.

"This case is also an important reminder for people to be aware of their super affairs, and their obligations. There are some very limited circumstances where you may be able to withdraw your super early, but generally you can only withdraw your super when you reach preservation age and stop working."

Read more: Form Super FundKent NguyenIan ReadAustralian Taxation Office
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