It is proposed that approximately $8 million of this funding package will be used by ASIC to embed a team of dedicated supervisory staff within Australia’s big four banks and AMP.
A team of 25 ASIC staff have been assigned to the embedding project which intends to physically place staff inside these five financial institutions to monitor governance and legal compliance. The staff will rotate through the institutions at various times using ASIC as their home base, reporting on their findings. ASIC chairman James Shipton outlined that ASIC intends to deploy its senior staff “to hold the most senior people inside these financial institutions to account”. Mr Shipton flagged a “second wave” of the project which will target other large financial institutions at an unspecified later date.
In addition to its embedding project, ASIC has stated that it will use the funding package to:
increase supervision of superannuation funds
create a corporate governance taskforce to investigate the effectiveness of corporate governance standards
review the management of conflicts of interest within the financial advice industry
promote regulatory technology being adopted by Australian financial firms
pursue more serious misconduct claims against wealthy litigants
establish a special taskforce to identify and pursue failings in large listed companies
enhance the protection of whistleblowers who call out unlawful and unethical behaviour in the financial services sector
In response to this recent announcement, Australian Banking Association CEO, Anna Bligh, has commented that the shared goal of the government, regulators, and the sector is “Restoring trust and confidence in Australia’s banks through an open and transparent industry”, and that “Banks will work proactively and in good faith with ASIC” to ensure the efficient implementation of these announced regulatory measures.
If you have any questions please contact Hillary Ray or a member of our Financial Services team.