ASIC today released its first report detailing ASIC enforcement actions for the period 1 July to 31 December 2011.
ASIC’s strategic priorities are to ensure investors and financial consumers confident and informed, markets are fair and efficient and registration and licensing systems are efficient. Holding the ‘gatekeepers’ of the financial system to account is an important part of how ASIC achieves its priorities. Investors and financial consumers rely on them to promote sound investment practices, prevent or detect market failures and promote market integrity.
The report outlines categories of gatekeepers against whom ASIC has taken action including financial advisers, responsible entities, credit licensees, market participants, directors, company officers, insolvency practitioners and auditors.
ASIC Chairman Greg Medcraft said, ‘Broadly, there are four principles of conduct gatekeepers must observe. They must display honesty by respecting other people’s property and not using a position of trust for self-advantage; diligence by applying due care and skill to advice or decision making; competence by meeting any applicable conduct, licensing, registration and training obligations; and independence by managing conflicts of interest appropriately.
‘When gatekeepers do not demonstrate these behaviours, we act. We are committed to tracking down and punishing wrongdoers and deterring further misconduct. No one is beyond the law, and we have the resources to take on the big cases where it is in the public interest to do so,’ he said.
‘The release of ASIC’s first enforcement report shows the breadth of our enforcement activities and demonstrates the type of poor conduct we are focused on,’ said Mr Medcraft.
The enforcement outcomes set out in the report relate to a wide range of matters from offences attracting significant penalties to record-keeping type offences grouped under the heading compliance and deterrence. They include 355 enforcement outcomes, including 252 criminal actions, in the six-month period.
Appendix one of Report 281 ASIC enforcement outcomes: July to December 2011 (REP 281) sets out statistics about ASIC’s enforcement activities.
The enforcement outcomes represents formal actions taken to secure compliance about which ASIC has made a public announcement (with the exception of a number of matters relating to ASIC’s registration and licensing function). This report does not address enforcement outcomes from ASIC’s market supervisory functions. Key outcomes for that area are set out in Report 277 ASIC supervision of markets and participants: July to December 2011 (REP 277).
The release of REP 281 follows the release of Information Sheet 151 ASIC’s approach to enforcement (INFO 151), Information Sheet 152 Public comment (INFO 152) and Regulatory Guide 100 Enforceable undertakings (RG 100).
It is anticipated that similar reports on ASIC’s enforcement activity will be released every six months.