Corporate regulator hires a psychologist to support whistleblowers taking risks to report misconduct

Too many whistleblowers were going directly to ASIC’s chair and its commissioners, but an automated system appears to have backfired as tipsters are left in the dark on investigations.

ASIC chair Joe Longo. Picture: Colin Murty

The corporate regulator has appointed a psychologist to support whistleblowers who feel they are struggling to be heard.

The decision was one of several recommendations the Australian Securities & Investments Commission received last year after the agency commissioned a review into its handling of reports of misconduct.

Sources told The Australian the findings of the review, which kicked off in March last year, were delivered to ASIC chair Joe Longo and agency management in August 2024 by a small consulting firm.

This was designed to address internal concerns and external criticism of ASIC’s policing of corporate misconduct in Australia, with a Senate committee hearing the regulator only investigated a handful of the thousands of complaints lobbed at it.

The consultants identified that many complainants who attempted to raise issues with ASIC were trying to contact the chair and its senior officers directly. But an automated process designed to free-up agency capacity backfired because whistleblowers and tipsters were left in the dark after taking what they perceived to be a personal risk in alerting the regulator.

An ASIC spokesman said the regulator was “constantly looking at how best to allocate its resources to fulfil its mandate to act against misconduct in the financial system”.

He confirmed ASIC had conducted a review of “how it manages initial assessment of reports of misconduct it receives”.

“The key outcome will be improvements in coming months to the way reports of misconduct can be made through the ASIC website, harnessing new technology and human centred design.”

ASIC chair Joe Longo and commissioner Simone Constant. Picture: Paul Jeffers

The ASIC spokesman said the changes would “improve the experience of reporting concerns to ASIC and support people to find the best avenue for them in their situation, including for whistleblowers.”

ASIC previously kept whistleblowers closely informed on the progress of investigations but at a huge cost to resourcing.

The ASIC spokesman confirmed the regulator had employed a registered psychologist “to help uplift our capabilities for whistleblower and witness support including further training and development for our staff”.

ASIC has struggled with retaining witnesses willing to give evidence in investigations.

An insider trading case against ex-Vocus chair Vaughan Bowen collapsed when ASIC was unable to rely on evidence from the telco’s former general counsel Ashe-Lee Jegathesan, who wished to claim privilege against self-incrimination. Mr Bowen was acquitted.

The regulator has also faced the challenge of ensuring whistleblowers, many of whom face high personal costs, don’t become disheartened.

Some key matters before ASIC, including ASX-listed ANZ, WiseTech and Super Retail Group, may hinge on disclosures from whistleblowers.

“Not only do whistleblowers have particular legal protections ASIC staff need to uphold, they and the witnesses that are part of ASIC’s cases are often in a vulnerable state and require special support,” the ASIC spokesman said.

Mr Longo has made digital transformation of the agency a key goal in his time leading the corporate cop.

ASIC has lobbied the federal government for more funding, to backstop its transformation and bolster its resources.

But the agency has also been troubled by critics, several of whom warn it has failed to listen to, and look after, whistleblowers.

ASIC has committed to bringing its ANZ investigation to a head by mid-2025.

Sources indicated the agency was looking at several well known companies, and expected enforcement action soon.

The re-elected Labor government will also be faced with making a call on the future of ASIC’s leadership, with ASIC watchers noting Mr Longo was likely to seek an extension to his mandate, amid potential successors jockeying for the position.

A report by Liberal senator Andrew Bragg, published in July 2024, found despite receiving tens of thousands of tip-offs annually, ASIC only commenced an average of 127 investigations.

Originally published as Corporate regulator hires a psychologist to support whistleblowers taking risks to report misconduct