To ensure that your interests are adequately and properly protected, the MPFA has a comprehensive approval and monitoring system, which includes:

Stringent Approval and Registration Criteria

Only companies and individuals that meet stringent criteria on capital adequacy, financial reliability, fitness and propriety as well as internal control standards can become approved MPF trustees. They are responsible for appointing fund managers and other service providers, and must ensure they comply with all requirements, standards and guidelines of the MPF. All MPF schemes must be established under trust arrangements and governed by the laws of Hong Kong. Scheme assets are held separately from the assets of the trustees and other service providers.

On-going Monitoring

The MPFA is empowered to regulate and monitor the operation of the MPF System and MPF trustees' compliance with statutory requirements. All trustees are required to submit returns, financial statements and internal control reports on a regular basis. The MPFA also conducts field inspections to ensure trustees comply with all the requirements. This also enables early detection of deficiencies and problems.

The MPFA investigates cases of suspected non-compliance with the requirements. For minor cases, the MPFA will issue warnings or impose financial penalties, and order the trustee to take immediate remedial action.

For more serious cases, the MPFA may require a special audit to be conducted on the trustee. During the investigation, the MPFA may suspend the trustee from administration of an MPF scheme, and appoint another trustee to administer the scheme on a temporary basis. Depending on the results of the investigation, the MPFA may revoke the approval of the trustee and terminate the trustee's administration of the scheme, as well as prosecute the trustee for serious breaches of the regulations.

Professional Indemnity Insurance

To provide scheme members with additional layers of protection, MPF trustees are required to take out adequate insurance to indemnify scheme members against any losses of scheme assets caused by misfeasance or misconduct of the trustees or their service providers.

Compensation Fund

There is also a statutory Compensation Fund set up under the MPFSO to compensate scheme members should the indemnity insurance not fully cover those losses. The Government had injected HK$600 million as seed money into the Compensation Fund. When in need, the MPFA may apply to the courts to make use of the Fund.