media release (17-009MR)

ASIC closes self-funded health plan

Published

ASIC has closed a savings-based health plan operated by Members Plan Pty Ltd (Memplans) on the basis the arrangement should have been registered as a managed investment scheme.

Under the scheme, which was operated via an online platform, members made regular subscription payments to Memplans. Any interest accrued was distributed to members based on their length of membership. An amount representing 80 per cent of a members' contribution was allocated to their account to accumulate for the purpose of paying for health services.

Members had access to "preferred" health care providers who offered services at capped rates, as well as loyalty and referral bonuses, which could be used to pay for health services.

ASIC raised concerns with Memplans that it was:

  • operating an unregistered managed investment scheme, which was required to be registered under the Corporations Act;
  • engaging in activities which required it to hold an Australian Financial Services (AFS) licence, including  dealing in financial products and providing financial product advice, without holding an AFSL; and
  • issuing interests in a managed investment scheme to retail clients, without providing appropriate disclosure in the form of a Product Disclosure Statement or Financial Services Guide.

Memplans has cooperated fully with ASIC in addressing its concerns by:

  • ceasing to operate the scheme including taking down the Memplans website;
  • contacting all members and advising them of the cessation of the scheme and requesting that they immediately cease payments to Memplans until further notice; and
  • refunding the members' account balances to them.

ASIC Commissioner John Price said, ‘ASIC supports innovation that has the potential to provide benefits to consumers and efficiencies to industry.'

'We expect operators of novel arrangements to ensure that they do not inadvertently breach provisions of the Corporations Act, which are designed to protect investors and promote trust and confidence in our financial markets. We will take action to address concerns where we find deficient arrangements.’

ASIC acknowledges the full co-operation of Memplans in addressing ASIC's concerns.

Media enquiries: Contact ASIC Media Unit