ASIC is getting a boost from the government to protect consumers from corporate and financial misconduct, following "sobering" testimonies heard during the royal commission’s probe on wrongdoing in the financial industry.
Several reforms introduced on Friday (20 March) seek to increase maximum civil penalties in order to bring Australia's fines into closer alignment with leading international jurisdictions. The penalties are meant to effectively discourage unacceptable conduct.
Reforms also include expanding the range of contraventions subject to civil penalties, and increasing penalties for severe criminal offenses. ASIC's power will also significantly increase by:
- Expanding its ability to ban individuals from performing any role in a financial services company where they are found to be unfit, improper, or incompetent
- Strengthening its power to refuse, revoke or cancel financial services and credit licences where the licensee is not fit or proper
- Boosting the regulator’s tools to investigate and prosecute serious offences by harmonising its search warrant powers to provide it with greater flexibility to use seized materials, and granting it access to telecommunications intercept material
ASIC has already received $127m in additional government funding to bolster its investigative and surveillance capabilities.
Reforms were based on the 50 recommendations made by the ASIC Enforcement Review Taskforce. The government will prioritise the implementation of the 30 recommendations. The remaining 20, which relate to self-reporting of breaches, industry codes and ASIC's directions powers, will be considered in the royal commission’s final report.
“We've got a new deputy commissioner of ASIC [Daniel Crennan] starting very shortly whose job is to prosecute in these areas. Our plan was to ensure we took action immediately, not wait,” Treasurer Scott Morrison told the media on Thursday.
Treasurer heaps praise on royal commission
Morrison also praised the royal commission’s work during the same Thursday doorstop interview. "They're there to get a job done and to ensure that confidence can be restored in the culture and behaviour."
He also stressed that Australia's banking and financial system is still one of the strongest in the world.
“There are no systemic issues associated with our banking and financial system that have been identified here, or are likely to be identified,” he said.
“There are clearly cultural and behavioural issues the government was aware of because we were already acting on those issues and we'll continue to act on those issues. But we should not confuse that with any issues of systemic risk in the banking and financial system. They are completely different issues and it would be very dangerous to confuse them,” Morrison said.