A Change is Gonna Come: ASIC in action

It’s been a long, a long time coming
But I know a change gonna come, oh yes it will
— Sam Cooke "A Change is Gonna Come"

Counsel for the Commission aside, few people emerged from the Royal Commission “trailing clouds of glory” or enjoying public acclaim.

The Commissioner’s criticism of some licensees was trenchant, legitimately so in some cases, but the Regulators also had their conduct and effectiveness discussed and neither APRA nor ASIC escaped unscathed.

ASIC, to its credit, seemed to acknowledge and accept the criticism of its timidity and ineffectiveness, but responded swiftly. They may, as one Melbourne Lawyer suggested, be “baring broken teeth” but we’ve noticed a marked increase in the assertiveness of their staff and a new willingness to actively drive the improvement of participants’ conduct and standards.

We previously addressed ASIC’s new focus and their “why not litigate” alternative to Enforceable Undertakings. No-one should be surprised by ASIC’s new belligerence. ASIC’s Deputy Chair, Daniel Crennan, has repeatedly outlined ASIC’s position. While some commentators have dismissed this as posturing, ASIC appears both willing and keen to avail themselves of the $404 million war chest handed to them by the Treasurer in March.


In the past, this update has focused on immediate enforcement statistics, themes and case studies, and this report continues that approach.

However, ASIC’s success as a regulator cannot and should not be measured solely on the outcomes of criminal and civil actions.

What we want to achieve is a substantial improvement in culture and conduct – the willingness to act efficiently, honestly and fairly.
— Daniel Crennan QC – ASIC Deputy Chair
Crennan weapons (1).png

Your reaction to ASIC’s new mandate may depend, to a very great degree, on whether you a consumer or a regulated person. While consumers would be expected to welcome an active and effective regulator, professional advisers seem to be even more enthusiastic about the emergence of a regulator that acknowledges an advice profession and consistently and effectively removes bad agents and poor gatekeepers.

What might surprise you, and what has surprised many, is that even while dealing with the Royal Commission, and the ensuing fallout of the Royal Commission, ASIC have been quite active.

ASIC Enforcement Update July to December 2018 Report 615

In our view, this infographic represents the low watermark for ASIC activity; increased funding, new regulatory tools and public expectations suggest that the industry should brace for a king-tide.

Read REP 615 to understand where ASIC have been, but study it closely to ensure you appreciate where they’ll go (and what they’ll do) to:

  • change behaviours to improve outcomes for consumers and investors;

  • act against misconduct to maintain trust and integrity in the financial system;

  • promote strong and innovative development of the financial system; and

  • help Australians to be in control of their financial lives.


Well good morning Judge, how are you today
I’m in trouble, please put me away
— 10CC , "Good Morning Judge"

We don’t want to increase industry apprehension but, for the next six months, ASIC will be focusing on Licensee misconduct.

This is entirely expected given the Royal Commission’s observation and it is a welcome diversion to their focus on SMSF and direct property recommendations. They will, no doubt, also expose a number of licensees that are ignorant, or unconcerned, about their licence obligations.

This is to be expected and competent licensees should use this opportunity to reconfirm, or refine, their compliance and governance arrangements (paying particular attention to capacity, supervision and complaints). If CEO Tony Beaven is correct, reviewing the capabilities of your Officers and Responsible Managers would be time well-spent.

If you’re worried that mortgage brokers and credit representatives have once more evaded regulatory scrutiny, understand that there will also be an increased focus on responsible lending and and inappropriate recommendations.

In any event, ASIC’s focus on gatekeepers and ‘other peoples’ money’ will not change.

We’d recommend that you anticipate ASIC’s pro-active approach and pre-empt their scrutiny by reviewing, and refining, your current arrangements.

A Change is Gonna Come so make the effort now to prepare for tomorrow.

If you need help, drop us a line or email help@assuredsupport.com.au