The Commonwealth Bank has been named as the first of the big four banks to have ASIC staff working internally inside the organisation to investigate misconduct.
Senior staff from ASIC will start working inside Commonwealth Bank as of today as part of their broader plan to stamp out misconduct in the big four banks and AMP.
The Commonwealth Bank said that it looked forward to working with ASIC to implement the program.
“As we have previously indicated, we welcome this move by ASIC as a positive and constructive step forward in the regulatory oversight of the banking industry. We look forward to working closely with ASIC to help produce the best outcomes for all of our stakeholders.”
ASIC chairman James Shipton told Senate Estimates that the initiative to embed staff in institutions would hopefully help to change company culture.
“We have an onsite supervisory program, which is the first of its kind in Australia, that is a new strategic initiative that we can [use to] build and characterise change,” he said.
Shipton said the initiative was “all about putting physically on site, inside these financial institutions, our supervisory officers”.
These teams will be led by “very senior chief supervisory officers,” he added.
“By having ongoing and physically present monitoring of financial institutions, we hope that that will help catalyse the behavioural change and the awareness that… is needed by financial institutions.”
Though the Commonwealth Bank is the first bank to host staff from the ‘corporate cop’, ANZ, Westpac and NAB are soon to follow.
Shipton also called on the government to help beef up ASIC by passing legislation that would increase penalties on companies.
“It is vital that the increased penalties and regulatory powers – product intervention powers, design and distribution obligations, as well as a directions power – pass the Parliament as soon as possible,” he said.
The move comes after the regulator is under fire for going missing in actions against banks and the royal commission has revealed a stem of financial scandals in the country.