Oz gov’t taskforce recommends higher ASIC penalties
An Australian government taskforce set up to consider the country’s current penalties regime covering the financial services sector has recommended a substantial increase in the penalties available to the Australian Securities and Investments Commission.
The recommendations, made by the ASIC Enforcement Review Taskforce and published yesterday in a 95 page draft document on the Australian Treasury’s website, follow on from an earlier recommendation that penalties for certain types of financial misconduct be “substantially increased”.
They recommend among other things an increase in the maximum civil penalty amounts that those found guilty of financial crimes could have to pay.
Individual fines could rise to A$420,000 from A$200,000, while those for corporations to A$2.1m from A$1.m, under the proposals.
The penalties for failing to supply a statement of advice, or SOA, would be among those that would be increased if the recommendations are ultimately adopted.
In addition to increasing the civil penalties ASIC would be able to seek, the proposals also call for so-called “disgorgement remedies” – removal of benefits illegally obtained or losses avoided – in civil penalty proceedings brought under the Corporations, Credit and ASIC acts.
The proposals were welcomed by Australia’s Minister for Revenue and Financial Services Kelly O’Dwyer, who issued a statement, also posted yesterday on the Treasury’s website, saying the “taskforce process” would help to ensure that ASIC “has the right tools to combat corporate and financial sector misconduct and to protect consumers”.
The taskforce had been established in October 2016, and included senior members of the Treasury, ASIC, the Australian attorney-general’s department and the office of the Commonwealth Director of Public Prosecutions, as well as representatives from industry bodies, consumer groups and academia.
The taskforce’s position paper, entitled Strengthening Penalties for Corporate and Financial Sector Misconduct, is open for comment until 17 November, with the taskforce due to present its final recommendations to the government by the end of November.