Ms Slattery said new members of some funds are being given the impression that they need to roll over existing superannuation to become members.

“It is not only misleading but also deceptive as members may have insured benefits or investment options in other funds that might not be available if they roll over to an APRA fund,” she said.

“Investment options also may be more restricted and some investment strategies unavailable.”

Ms Slattery was cricital of the direct investment options provided by some APRA-regulated funds.

These options, she said, “have high concentrations in particular investment classes, bringing into question the lack of diversification of members' investment portfolios”.

“This is something SMSFs are continually criticised for failing to have and is a fallacy with the vast majority of SMSFs,” said Ms Slattery.

“What’s interesting is that these direct investment options are being likened to an SMSF – an erroneous and misleading comparison.”

'SMSF' is a term specifically defined under law and no one is able to mislead consumers into thinking they are getting something similar in another option, she said.

“The fact is, these direct investment options in the APRA funds typically don’t have the range of investment choice or the flexibility of an SMSF,” said Ms Slattery.

“A duck is not a chicken, and an APRA fund is not an SMSF – no matter how it is dressed up. It is either an SMSF or it is not.”

Anecdotal evidence suggests the take-up of these direct investment options is slow, she added.

“A hardly surprising outcome when performance has shown to be below the same fund’s standard investment options and fees can significantly erode balances,” Ms Slattery said.