'Don't focus on pushing jail time,' ASIC told
Jail time is no deterrent to bad advisers and therefore ASIC should focus more on negotiating punishments with small-time offenders as a way to wrap up cases faster, argues senior counsel Murugan Thangaraj of the NSW Bar.
Speaking as a panelist at a Governance Institute of Australia event in Sydney yesterday, Mr Thangaraj said ASIC spends too much time trying to push jail time for petty crime, which allows other bigger crimes to go unnoticed.
"People have a view that a lot of white collar criminals get away with it, and that is correct," he said.
"If there's a limited capacity for resources, rather than spending an enormous amount of time on small cases, you could get an early conviction [through negotiations] on the basis of no jail and then run five other investigations that never would have been run as a consequence."
Mr Thangaraj said offenders are more likely to cooperate with a negotiated punishment, thus wrapping up the case more quickly.
What deters future misconduct are the "facts of convictions" that ruin reputations, he added.
"[For example,] the effect it has on their career, the reputational outcomes both professionally and socially," Mr Thangaraj said.
"Deterrence comes not from reading something in the paper about someone who's been sent to jail but by knowing of someone [who was convicted] within the organisation or in the next building because they don't want to be in that position."
ASX managing director Elmer Funke Kupper, also a panelist at the event, agreed with Mr Thangaraj's suggestions. He added that ASIC should also focus more on the senior management of troubled companies.
"We're sometimes surprised that companies who pay enormous numbers of fines over a course of five or six years at the end of that still have the same chief executive," he said.
"At what point do you lose the right to run these organisations?"
ASIC commissioner John Price, who was an audience member, said he also agreed with Mr Thangaraj's comments about spending too much time on cases. However, he believes jail time should still be sought.
"Even for civil cases, court processes can be quite lengthy. The average time from starting a trial to getting a judgement is measured in years not months," he said.
"We certainly welcome negotiated settlements with parties. Not everyone does, and surely [they] have different views.
"I think many would argue incarceration is still the most significant deterrent in terms of crime," he said.
Bravura to acquire Midwinter for $50m
Bravura Solutions has announced it has entered an agreement to acquire financial...
IRESS records 10% profit growth in 1H19
Advice software provider IRESS noted significant revenue growth in its APAC fina...
FPA members to be given education discounts
The Financial Planning Association of Australia has teamed up with five higher e...