Insider tracking of the Big Four banks

THE corporate watchdog will for the first time have specialist investigators embedded inside the Big Four banks to check for dodgy behaviour and consumer rip-offs.

THE corporate watchdog will for the first time have specialist investigators embedded inside the Big Four banks to check for dodgy behaviour and consumer rip-offs.

The Australian Securities and Investments Commission will also be given more cash to crack down on wrongdoers and take them to court.

It is part of a bid to ramp up the enforcement actions of the watchdog, which has been criticised at times as being underfunded and a toothless tiger.

The specialist investigators will be based in the bank offices focusing on compliance, but with the ability to shift focus between areas such as loans or financial advice as needed.

The move follows damning allegations at the royal commission into the financial sector, which has heard of widespread misbehaviour within the banks.

Financial Services Minister Kelly O’Dwyer will today announce $70.1 million for ASIC to ramp up its enforcement capabilities.

“For the first time, ASIC will be funded to embed corporate cops directly within Australia’s five largest financial institutions – the Big Four banks and AMP – to monitor governance and compliance actions,” she said.

“It will ensure that ASIC is on the front foot when it comes to considering any deficiencies in the governance and compliance structures of these large financial institutions, so as to prevent harm to consumers before it occurs.”

The funding includes $26 million to accelerate prosecution of alleged corporate misconduct through the courts, $8 million for inspectors to be embedded within the banks and AMP, and $6.6 million for ASIC to better deal with whistleblower tip-offs.

There will also be $6.8 million for the watchdog to “pursue failings” in large listed companies by deploying staff to conduct onsite surveillance and investigations, with funds for other enforcement and compliance activities.

Labor criticised the Government after forward budget papers revealed $26 million being cut from ASIC budget by 2021.

But the Government had earlier boosted funding by $121.3 million in 2016 to bolster its investigative capabilities.