ASIC the enforcer: Regulator reveals raft of investigations in the works

ASIC the enforcer: Regulator reveals raft of investigations in the works

The Australian Securities and Investments Commission (ASIC) has announced it will set up a separate Office of Enforcement as part of a new "Why not litigate?" approach in the wake of the Royal Commission.

The regulatory tiger will also have sharper teeth following the recent passing of the Treasury Laws Amendment Bill 2018, allowing for penalty provisions with "greater deterrance value".

These harsher penalties include an increase in maximum prison penalties for the most serious offences to 15 years, higher civil penalties for companies to be capped at $525 million, and higher capped civil penalties for individuals of $1.05 million.

"Significantly, the Bill also introduces, for the first time, a civil penalty (capped at $525 million) for breach of the primary obligation banks and other financial services and credit licensees owe to all of their customers, that is 'to do all things necessary to ensure the financial services covered by the licence are provided efficiently, honestly and fairly'," the regulator said in an update today. 

ASIC has revealed it is currently working on almost 40 cases including prioritised work on 11 specific referrals from the Royal Commission in relation to eight entities.

"This was in addition to two referrals made during the course of the Commission's hearings. We have prioritised work on those matters," the commission said.

In addition, ASIC's enforcement teams are investigating 12 other case studies that were before the Royal Commission while proceedings have begun with respect to fees for no service (FFNS) at National Australia Bank's MLC, as well as a case against Dover Financial Advisers and its former chief Terry McMaster.

"ASIC is assessing another 16 case studies to determine whether investigations should be commenced," the regulator added. 

"Aside from the Royal Commission case studies, ASIC's enforcement teams are undertaking a large volume of work on a range of misconduct relating to major financial institutions and their representatives.

"ASIC expects these investigations to result in a number of referrals to the Commonwealth Director of Public Prosecutions for assessment for criminal prosecution."

ASIC chair James Shipton says the document is a crucial document as it highlights the organisation's important work to date for putting itself on a more strategic footing, including the creation of the new Office of Enforcement.

"ASIC looks forward to working with the Parliament, the Government, APRA and other regulators on these reforms that are so crucial to the creation of a fair, strong and efficient financial system for all Australians," Shipton says.

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