Greenwashing, predatory lending and investment scams top ASIC’s hit list

For the first time, the corporate watchdog has identified areas of enforcement focus and will now do so annually.

ASIC deputy chair Sarah Court has outlined the regulator’s enforcement priorities.

The corporate regulator has put greenwashing, predatory lending and investment scams at the top of its enforcement priorities for the year ahead.

Speaking at the Australian Securities and Investments Commission’s annual forum in Sydney on Thursday, ASIC deputy chair Sarah Court said it was the first time the regulator had identified particular areas of enforcement focus, and said that it expected to now do so on an annual basis.

“We are prioritising the disruption of scams, including through working with other regulators, industry and social media platforms to reduce harm,” Ms Court told the forum.

In the two years to June 2022, ASIC received more than 2200 reports of misconduct regarding crypto-assets or crypto scams.

“Accordingly, an enforcement priority going forward will be protecting Australians from investment scams and high-risk investment products, including crypto assets.”

Protecting consumers from predatory lending practices, meanwhile, is a priority for the year ahead. ASIC research has revealed that more than 40 per cent of Australians hold two or more credit products and there is an expectation that demand for credit cards, personal loans and short-term credit arrangements will increase.

“In addition to misconduct in the credit industry, ASIC will focus on failures in the general insurance industry to honour promises to consumers, as well as addressing unfair contract terms in insurance products,” Ms Court said.

“In the superannuation sector, we will look to take action where we see instances of misleading conduct and poor governance.”

The watchdog will also closely monitor for misleading conduct and claims of greenwashing “that cannot be sustained” – and take enforcement action when necessary.

“ASIC’s enforcement work will not be limited to these priorities, and these may evolve as new and emerging issues or products come to our attention,” Ms Court said.

“We will continue to direct our enforcement resources to ensure we maintain a fair, strong and efficient financial system for all Australians.”

Alongside its focus on greenwashing, predatory lending and investment scams, the regulator said five enduring priorities would remain in place over the long term.

These were listed as: misconduct damaging to market integrity including insider trading, continuous disclosure failures and market manipulation; misconduct impacting First Nations people; misconduct involving a high risk of significant consumer harm, particularly conduct targeting financially vulnerable consumers; systemic compliance failures by large financial institutions resulting in widespread consumer harm; and new or emerging conduct risks within the financial system.

Originally published as Greenwashing, predatory lending and investment scams top ASIC’s hit list