Commonwealth Bank of Australia and its wealth management arm Colonial First State have been hit by a class action law suit over allegedly uncompetitive superannuation returns.
Law firm Slater & Gordon has filed proceedings in Federal Court and claims damages could exceed $100 million for hundreds of thousands of superannuation members.
The action alleges Colonial First State invested the retirement savings of its members with its parent bank, where the cash received uncompetitive bank interest rates.
"We will allege that by dumping members' super with its parent bank, the CBA, Colonial First State failed to obtain the most competitive interest rate available for its members invested in cash-only investment options and balanced options where there is a cash component," Slater & Gordon head of class actions Ben Hardwick said on Wednesday.
"The class action will allege there is no excuse for Colonial First State to have accepted such a low rate from CBA when it could have easily obtained a higher rate – either from the CBA or from any other bank."
Trustees are required by law to act in the best interests of super fund members.
"This class action will allege Colonial First State placed the interests of its members beneath the interests of the Commonwealth Bank," Mr Hardwick said.
