The Australian federal government is poised to introduce much-anticipated reforms to superannuation law aimed at closing a significant loophole that allows perpetrators of domestic violence to receive superannuation death benefits from their victims’ funds. This initiative stems from ongoing advocacy in the industry, following distressing cases, including that of Molly Wilkes, which has drawn public and parliamentary attention.
Currently, existing legislation enables a superannuation fund to pay death benefits to a person who has committed domestic or family violence against the deceased unless it is proven that their actions directly caused the individual’s death. This disturbing reality was highlighted when Wilkes, a 22-year-old who had suffered from serious coercive control and physical abuse, tragically took her own life. Despite her mother Julie Adams being listed as the beneficiary of her superannuation, the law mandated the payment of $65,000 to Wilkes’ spouse, whom Julie accused of being a significant factor in her daughter’s death.
Misha Schubert, CEO of the Super Members Council of Australia, expressed her dismay that such a loophole remains in place, stating, “Many Australians are absolutely shocked to understand that this loophole still exists in the law.” The recent consultation paper by the government highlighted that only around 10% of superannuation holders have a binding death benefit nomination, further complicating the situation.
As the consultation period has concluded, various advocacy groups are supporting the proposal to enforce a forfeiture-like rule, which would prevent abusers from profiting through superannuation benefits linked to the victims. Schubert emphasized the common principle in law that prevents offenders from benefitting from their crimes, saying, “There’s a principle of forfeiture law in wider common law … where if someone is convicted of killing a person, they are not able to profit from that person’s death.”
The government is considering measures to provide super trustees with more authority in handling these sensitive payouts, potentially denying benefits to perpetrators under specific conditions. Another option could involve addressing complex cases in family court; however, advocates have pointed out the challenges this could create for grieving families.
The Super Members Council has also urged for similar reforms to apply to self-managed super funds, ensuring that new laws are applicable across various super arrangements, including defined benefit schemes. The overall aim is to prevent further injustices by ensuring that those who cause harm do not profit from their actions.
In a joint statement, several advocacy organisations, including Super Consumers Australia and Domestic Violence NSW, commended the government on its commitment to reforming this aspect of superannuation law, calling the changes “long overdue.” Lily Jiang, Director of Advocacy at Super Consumers Australia, stated, “We welcome the Government taking action but the solution needs to make all super trustees responsible for considering DFV in death benefit claims and deliver fair and consistent outcomes for people impacted by DFV and abuse.”
As these legislative changes are set to unfold, they promise to create a fairer system that protects victims of domestic violence, preventing their abusers from profiting from the tragedies they caused.
