Finance Finance News ASIC given power to embed staff in big four banks, AMP
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ASIC given power to embed staff in big four banks, AMP

ASIC given news powers to police the big four banks
Australians seem to have a problem with their banks. Photo: Getty
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The Australian Securities and Investments Commission (ASIC) will, for the first time, have enhanced powers to embed its enforcement staff into the major banks and wealth manager AMP as part of an “expanded armoury” to fight white-collar crime.

The corporate cop will have its budget boosted by more than $70 million as the regulator pushes back against claims at the financial services royal commission that it has been “asleep at the wheel” in the fight against corporate misconduct.

In what is described as a new supervisory “refocus”, ASIC will be empowered to place dedicated staff within the “big four” banks – ANZ, Westpac, Commonwealth Bank and National Australia Bank – to directly monitor governance and compliance.

Wealth manager AMP – which stands accused of charging fees for no service and lying to ASIC – is also included in the $8 million embedding budget as part of the crackdown on unlawful and unethical behaviour.

The expanded ASIC powers come after a lengthy review by the newly appointed ASIC chairman, James Shipton, who will announce the new funding today with Treasurer Scott Morrison and Financial Services Minister Kelly O’Dwyer.

Ms O’Dwyer told the ABC that the new funding will ensure ASIC is on the front foot in dealing with big financial companies to prevent harm to consumers before it occurs.

“These new resources will ensure that ASIC is the tough cop on the beat — the tough cop that all Australians need, and expect, ASIC to be,” Ms O’Dwyer said.

“The package will allow ASIC to better combat corporate misconduct and misconduct in the financial services industry like never before.”

The new measures also include $26.2 million to help ASIC pursue serious misconduct actions against “well funded litigants” and $6.8 million for a special taskforce to “identify and pursue failings in large listed companies” where ASIC staff could be deployed to investigate potential misconduct.

Whistleblowers who call out unlawful and unethical behaviour in the financial services sector will also receive greater protections with $6.6 million provided to enhance the Federal Government’s whistleblower protection laws.

The enhanced funding for ASIC follows the Federal Government’s initial resistance to call a royal commission until it caved into political and community pressure late last year.

In addition to the appointment of James Shipton as ASIC chairman, the Federal Government appointed a second deputy chair, Daniel Crennan QC, to specifically focus on enforcement.

The $70.1 million package to be announced today follows $121.3 million in additional funding provided to ASIC in 2016 to bolster its investigative and surveillance capabilities and tougher criminal and civil penalties announced in April this year.

Funding is being cut at Australia’s corporate regulator and staffing levels will be reduced, according to figures in Tuesday’s federal budget.

The May federal budget revealed a reduction in government funding for ASIC of $28 million over three years with average staffing levels to drop by 2 per cent — 30 positions — this financial year.

Funding will reduce from about $348 million this financial year to about $320 million in 2020-21.

-ABC

 

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