ASIC's move to begin recovering investigation costs from prosecuted wrongdoers will speed up the process, after the regulator today raised concerns that investigations were taking too long.
Addressing the Parliamentary Joint Committee on Corporations and Financial Services today, ASIC commissioner John Price said that by using this power more frequently, those being investigated may be encouraged to cooperate, which will mean quicker outcomes.
"What really was the guiding principle for us was that, philosophically, the current commission believes that the people who drive the need and the cost for regulation should pay the cost for those regulations," he said.
"ASIC has no incentive at all to delay its investigation. We want to get through investigations quickly because that creates a quicker, deterrent message to the market, and it also enables us to look at a broader range of misconduct.
"I have, on occasion, been concerned that investigations were being unnecessarily drawn out," he said.
"I think if the parties that are subject to investigation understand that they may not only be subject to an order for legal costs, but an order for ASIC investigation costs, that creates a strong incentive to conduct investigations and legal proceedings in a matter that's quick and expeditious, and in the interest of all parties."
ASIC announced last month it will "more frequently" recover the expenses of an investigation from the person who caused the expenses to be incurred.
The regulator is entitled – under section 91 of the Australian Securities and Investments Commission Act 2001 – to be fully or partially reimbursed for the expenses related to the investigation and the remuneration of staff involved.
The new approach has applied to investigations since 29 July 2015 as well as to all investigations begun before this date but where an outcome has not yet been agreed.
Also last month, Assistant Treasurer Josh Frydenberg announced the federal government had commissioned a review to look into the capabilities of the corporate regulator. Mr Frydenberg said the capability review will ensure the regulator has the "appropriate governance, capabilities and systems" to meet regulatory challenges.
Speaking at today's hearing, ASIC chairman Greg Medcraft said "ASIC welcomes this review".
"It is a forward-looking review and will assess our ability to meet the government's objectives and future challenges," he said. "Looking at our current position, we consider we are effective and efficient within the resources we have."
Staffing levels at the prudential regulator will rise and consumer advocates will be given more cash under new measures outlined in Tuesday’s budget...
The commercial law firm has signed on to partner with Australia’s leading technology and innovation event for financial advisers. ...
Insurers and industry bodies are urging life insurance clients to get a COVID vaccine as soon as possible, amid social media speculation that getting ...