Telstra Super breached procedures for managing customer complaints, the Federal Court has ruled after the corporate regulator launched civil penalty proceedings.

The decision “sends a clear message that compliance with mandatory internal dispute resolution standards is not optional, but a legal obligation”, Australian Securities and Investments Commission deputy chair Sarah Court says.

The action, launched in 2023, was the first under the internal dispute resolution scheme after it started on October 5 2021.

The scheme requires financial services groups to record all complaints received through their IDR processes.

Super trustees must respond to a complaint no later than 45 calendar days after receiving it.

But the Federal Court found Telstra Super – which completed a merger with Aware Super last month – failed to respond in time to about one-third of relevant complaints between October 22 2021 and January 13 2023.

In about 30% of these cases, Telstra Super responded more than 100 days after it received the complaints.

The court also found that in some cases the group failed to explain why there was a delay in responding and did not inform people about their right to take matters to the Australian Financial Complaints Authority.

Ms Court said: “Financial service providers must invest in robust systems and devote adequate resources to ensure complaints are managed promptly and fairly. This protects consumers from harm and underpins trust in the superannuation system.”

Super Consumers Australia CEO Xavier O’Halloran says the ruling is an important win for customers and reinforces the need for stronger mandatory service standards across the super system.

“At an absolute minimum, Australians should be able to expect that super funds comply with existing mandatory standards like responding to complaints within 45 days,” he said.