ASIC slammed for letting white collar crime run rampant, calls for major overhaul

Australia’s corporate regulator has been absolutely eviscerated in parliament as a major change looms.

Australia’s corporate regulator should be overhauled and split in half because it has failed to protect the public from white collar criminals.

That’s according to a scathing new report tabled in parliament on Wednesday afternoon.

Liberal NSW Senator Andrew Bragg, who chairs the Economics References Committee, launched an inquiry into the Australian Securities and Investments Committee (ASIC) at the end of 2022 over concerns that it was doing a “very poor job” at enforcing corporate law.

“It is clear ASIC has failed,” the inquiry on Wednesday concluded. “Countless Australians have been hurt by ASIC’s consistent failure to investigate and deter corporate crime.”

Senator Bragg called for a major change in his list of recommendations – for ASIC to be separated into two distinct sections, “one focused on companies and the other on financial services enforcement,” he said.

Senator Andrew Bragg has lashed the corporate regulator. Picture: NCA NewsWire / Martin Ollman

“Its remit is too broad for it to be an effective and efficient agency, and the government should strongly consider separating its functions between a companies regulator and a separate financial conduct authority,” Senator Bragg added.

He also noted that ASIC itself acknowledged its responsibilities were “very wide”.

Over the years, the corporate regulator has been subject to multiple inquiries and even royal commissions but nothing appears to have materially changed.

One blatant example of this, according to Senator Bragg, is the case of one woman who fell victim to a housing organisation and lost money.

She reported the issue to ASIC and lodged a complaint at an inquiry in 1993.

More than 30 years later she is still fighting for justice.

“ASIC is the great survivor,” Mr Bragg told news.com.au in a sit-down interview earlier this year.

“My view is, is the common denominator here over decades, is ASIC.

“And it’s kind of transformed to be this absolute beast that no one seems to really take responsibility for.”

Another example of ASIC’s status as a toothless tiger, he added, is a shameful statistic.

“In the last year, the Great Barrier Marine Park Authority achieved more criminal prosecutions than ASIC. So ASIC is bringing fewer and fewer criminal cases every year. They are achieving more civil penalties, but I think that the criminal penalties are the ones that would really deter (people)”.

A spokesperson for ASIC told news.com.au: “Throughout the inquiry we have shared our strong enforcement record on behalf of Australian consumers and investors.

“ASIC is in court almost every day pursuing wrongdoing and in the last 12 months alone launched around 180 new investigations.”

They added ASIC will take time to consider the report, and is already working with the treasury to act on recommendations from the Financial Regulator Assessment Authority.

Australia’s corporate regulator has been absolutely eviscerated in parliament as a major change has been recommended.

ASIC has around 2000 staff and nearly $800 million in funding, according to its latest publicly available report.

“It’s not a question of money and resourcing, it’s a question of focus,” Senator Bragg said at the time of the inquiry commencing.

“The community expectation of ASIC is not particularly good. People need to be made examples of.”

But others, even other members of the Liberal caucus, don’t agree.

Senator Paul Scarr said earlier this year that he was happy with ASIC’s track record, which led to 306 criminal charges in the 2022-2023 financial year.

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Originally published as ASIC slammed for letting white collar crime run rampant, calls for major overhaul