ASIC to seek more power in 2017, law firm warns
The corporate regulator is likely to ask government for expanded enforcement and penalty powers in the year ahead, global law firm Herbert Smith Freehills has predicted.
In a statement issued yesterday alongside the release of a new report, HSF partner Andrew Eastwood suggested that ASIC is eager to see its own power increased as it continues its focus on “culture as an early warning sign for potential misconduct”.
“ASIC is expected to seek a significant increase in its enforcement abilities and the penalties it has available. We predict the regulator will succeed in its push for an increase in penalties in 2017. In addition, we expect ASIC will seek to significantly widen breach reporting obligations,” Mr Eastwood said.
“While there has been a move away from introducing some form of direct enforcement action for ‘bad culture’, there is some political impetus for poor corporate culture to be prosecuted. A Senate inquiry due to report in mid-2017 may be a catalyst for ASIC to lobby for a better culture ‘stick’ and for ASIC to use it.”
Meanwhile, Luke Hastings, the firm’s Australian head of disputes predicted that the compliance burdens for businesses around the world is likely to increase as global regulators, including ASIC, make better use of new technology such as artificial intelligence (AI) and biometric data.
“Global regulators will increasingly use artificial intelligence and biometric tools to collect, analyse and respond to data, as well as to predict and detect financial services wrongdoing. As a result, regulators will demand more information and move closer to real time surveillance,” Mr Hastings said.
“This will mean an increased burden for companies and they will need to ensure they are meeting regulatory requirements, not just in the jurisdiction they are headquartered, but in all the countries they do business.”
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