Advisers join ASIC in slamming Spaceship

Earlier this week, ASIC penalised both tech-focused super fund Spaceship and its Adelaide-based trustee Tidwell Financial Services for false and misleading claims relating to the Spaceship GrowthX fund.

Speaking to ifa sister title SMSF Adviser, Paramount Wealth Management director and former AFA president Wayne Leggett said the ASIC intervention should serve as a warning to consumers to be careful with marketing information.

“When choosing investments, any fund that includes absolutes in their promotional material, i.e. words such as ‘best’, should set off alarm bells,” Mr Leggett said.

Claire Mackay of advice boutique Quantum Financial also took issue with the over-selling approach, reminding consumers that the normal rules of analysis and critical thinking should apply to new-age super funds.

“A challenge to the incumbents is great for consumers, but there needs to be substance and not just a glossy marketing cover,” Ms Mackay said.

“My dad, who founded Quantum Financial, always said to be wary of financial institutions and investments advertised on the side of a bus, that have a pretty girl on the PDS or advertise on daytime TV. Now we can add Instagram to that list.”

The former ifa Excellence Award winner also said she agreed with the analysis of CuffeLinks editor and former Colonial First State executive Graham Hand.

In July 2017, Mr Hand wrote a critical assessment of Spaceship’s offer, investment philosophy, fees and marketing claims, which went unanswered by the usually savvy super fund.

Speaking to ifa this week, Mr Hand said he hasn’t revisited his analysis of Spaceship and that he was loathe to give the company any more “free publicity”.

However, he added that Spaceship’s approach has been ill-suited to the superannuation industry.

"Spaceship launched before it was ready for public investment,” Mr Hand said. 

"They did not describe the product properly, they assumed nobody would test their claims about a technology focus when it was mainly an index fund, and their systems did not work well. 

"They followed the Silicon Valley start-up mentality of speed to market and learn as you go, but this is inappropriate for superannuation savings in a regulated industry."