Following criticism in a Senate inquiry this week that ASIC was too slow to act on complaints about the Sterling Group – which eventually collapsed in 2019, leaving more than 100 customers facing possible eviction and heavy financial losses – chair Joe Longo acknowledged that more could have been done by the regulator at the time it received complaints.
“With the benefit of hindsight, we would have more closely engaged with the responsible entity on whether our concerns with the PDS were addressed,” he said.
“We may well have stopped the replacement PDS.”
However, when asked by senator Jordon Steele-John if ASIC would offer an apology to the victims, Mr Longo said it would not be “emotionally inappropriate”.
“At ASIC we do our best to look out for people who make investments… these individuals tragically made an investment,” Mr Longo responded.
“They signed a lease that was linked to an investment and that proved to be something that we now all know led to great losses for them personally.
“It’s emotionally inappropriate for me to say that ASIC should be apologising for that.
“I think what ASIC can say is that we’ve tried to respond to the issues that have been brought to our attention, tried to act in good faith, tried to be helpful to secure the interest of investors. But we now know that the tenant investors got caught up in a scheme that wasn’t sustainable.”
On Tuesday (16 November), Mr Longo admitted that ASIC received “two or three complaints or reports of misconduct… in late 2016, early 2017” however it did not become officially involved until a referral by the Western Australia Department of Mines, Industry Regulation and Safety in March 2017.
Mr Steele-John said the evidence shows that ASIC should have “acted quicker and shouted louder” when investigating the group.
The time is now to follow through with this – we cannot let him off the hook. Longo has dodged the real and long standing issue here (honestly, is he auditioning for a career in politics?). That real issue is, that like Storm and Reseau, at times potentially serious matters are referred to ASIC and not followed up on. The fact is that the process when we try to contact ASIC is the classic stone wall. One referral of something serious should be sufficient. There is a desperate need for when something like this is brought to their attention that someone at ASIC is tasked with the job of tackling it. It may be better that we have a channel to liaise through our professional bodies to create that accountability. That someone at ASIC would then have that accountability. At this time the buck rests with Longo – that reply is unsatisfactory at so many levels – he must take the wrap. We are entitled to expect far more proactive responses from our our erstwhile high paid corporate leaders. Not accepting that there is an issue that needs addressing and doing something more constructive is a surely a case for ‘Longo no Longer’!
ASIC are devoid of any emotion and connection whatsoever.
If they had any form of emotional intelligence at all they would not have treated advisers with the vitriol, disdain and relentless persecution for the last decade.
They are an organisation drunk with power and with no master to answer to.
Josh Frydenberg willl never ever reign them in as he also has a personal dislike for advisers.
We live in a democratic society but with a rogue dictator governing financial services.
Don’t blame ASIC- any regulator will behave this way if allowed. The blame is totally on AFA and FPA who have been in the pockets of the corporate insurers and corporate dealer groups and hence have not represented us individuals advisers who have faithfully paid our dues each year.
Joe Longo talks about a range of things they “tried” but thats bunkis…they really didn’t respond at all based on the evidence…my recollection from the RC is that Terry McMaster made similar comments “we had acted in good faith, we acted on what we believed was sound advice…etc etc” and they cooked his license and closed him down…ASIC…no care or responsibility so whoops is about all that happens to them….they are disgrace and they wonder why the WHOLE industry treats them with disdain and contempt.
AFCA should remember his comments when adjudicating on any, and all. future complaints against advisers…obviously abdication is a defence!!
[i]”Obviously it’s financial planners fault and we need proper regulation, and more education. ASIC needs more funding, and perhaps we could lift the Adviser levy, impose some tax to fund this, or give AFCA or whoever more powers or impose more regulation on those shonky advisers”[/i]……..I’ve been an adviser for 20 years and so I’m just saving us all some time by getting to the outcome now…..it’s a broken record…oh wait ……what do you mean there are no advisers left….at least none that deal with this class of investor. Who are we going to blame? Can we blame an App or a website tool.
“Emotionally Irresponsible”? Thank you, ASIC – I’ll try that one on my auditor next week and see how I go.
So typical of ASIC.
Culture, climate change, smashing advisors, these are the areas favoured by ASIC.
Anything regarding product, no way, anything regarding timely action, no way.
ASIC is the hindsight expert.
Close ASIC down.
Can someone throw ASIC under the bus now, for their failings , their lack of care, their slow response, their lack of apology, their lack of attention to detail.
ASIC, no care or responsibility, everything is above their pay grade. Must be hard on this one, they can’t throw advisers under the bus for their failing like they normally do.
I am always miffed about all the compliance advisers have to do and why eg: TMD (don’t get me started) but when the really bad ones are not caught like above I feel that what they are doing is not working so why put good advisers through all the pain that has no benefit to protecting the consumer.
To the best of my knowledge Stirling weren’t advisers…