ASIC needs a big investment from Canberra
If ASIC’s objective is to put the frighteners up Australia Inc, especially in financial services, it’s not going to come cheap.
The conduct regulator’s annual budget runs to about $350 million, of which $230m is industry-funded.
If the objective is to put the frighteners up Australia Inc, especially the financial services industry, it’s not going to come cheap.
A big investment is required in regulatory manpower and modernisation of the judicial system, including the creation of an expanded criminal jurisdiction in the Federal Court.
The cost of running the extensive Federal Court system in 2018 was $340m, with $66m spent on judges’ remuneration and a further $27m on superannuation.
Last Friday, the Morrison government appointed four new judges to the court.
Two of them were described as “Hayne appointments” to deal with the expanded caseload in civil matters flowing from the financial services royal commission.
The court received a $9.9m funding boost for the judges last November, with a further $41.6m set aside for the Commonwealth Director of Public Prosecutions over eight years to hire more prosecutors.
It’s anyone’s guess how much extra funding ASIC will need, but you can rest assured it will be in the many tens of millions.
ASIC deputy chairman and enforcement boss Daniel Crennan QC has amped up the rhetoric in anticipation, applauding the “astronomical” fines and “crippling” custodial sentences now available to him.
Hayne made 11 specific referrals to ASIC in relation to eight entities in addition to two referrals from the royal commission’s public hearings.
Crennan’s enforcement units are also undertaking investigations into 12 matters that were case studies before the royal commission, and have kicked off proceedings in relation to two other case studies — the National Australia Bank trustee company Nulis and MLC, and Dover Financial Advisers and its boss Terry McMaster.
Finally, ASIC is assessing a further 16 case studies to see if investigations should be started.
A number of referrals are expected to the CDPP for criminal prosecution, which is where the plans for the Federal Court’s expanded jurisdiction come in.
The plan is to share jurisdiction over misconduct in the financial services sector with the state Supreme Courts.
The Federal Court got the power to hear serious cartel conduct cases in 2009.
Funding for the measures will be part of the 2019-20 Budget, with a proposed start-up date of January 1, 2020.
gluyasr@theaustralian.com.au
Twitter: @Gluyasr
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