The regulator will target areas where poor practices may increase the potential for poor conduct which poses risk to investors and consumer trust and confidence.
Mr Medcraft said that the regulator would take administrative action where it finds flaws.
“For example, ASIC can seek to remove the firm’s licence on the basis that it’s not providing its services efficiently, honestly and fairly,” he said.
“ASIC will incorporate culture into risk-based surveillance reviews, use the surveillance findings to better understand how culture is driving conduct among those we regulate and communicate to industry and firms where we have a problem with their culture and conduct.”
However Mr Medcraft said there were only limited ways for ASIC to address culture directly in the laws. Further he said that those affected by poor culture were those that could least afford to be.
“Sadly those who get fleeced are usually not necessarily the country’s wealthy, but everyday Australians, who might have no more than their house and their super and perhaps a nest egg,” he said.
“People are often left with a loss they cannot afford. And that is why cleaning up culture is crucial. That is why restoring trust and confidence is crucial.”
I agree with the concept of making those in charge of culture accountable (think of the banks), however I would love to know their methodology.
I would describe bad culture as constantly focusing on the minority of negative incidents in the profession, and assuming we are all out to “fleece” our clients.
How about an education campaign to show people what good advice looks like?
#PerceptionCorrection http://www.positivityforplanners.com….
Does that mean that CBA s licence will be removed ?
Hey Medcraft, why don’t you prepare a risk based SOA that is, in your expert opinion, fully compliant and culture driven, then share that with the rest of the industry so we have a benchmark to work from?
Ahh, I get it – it’s much easier to criticize the soldiers waging the war on the front line when you’re sitting in your ivory tower isn’t it!