Banking royal commission: the curious case of why Corrs is no longer in ASIC’s corner

Why is blue-chip national law firm Corrs no longer acting for ASIC in the financial services royal commission?

Senior Counsel Assisting Michael Hodge (centre) and Counsel Assisting Eloise Dias (right) at the opening of the banking royal commission’s fifth round of hearings. Picture: David Geraghty/The Australian

In legal circles it’s become known as the curious case of Corrs.

Why is the blue-chip, national law firm no longer acting for ASIC in the financial services royal commission?

The word on the street is that rival firm Johnson Winter & Slattery has taken up the cudgels on behalf of the regulator.

JWS’s arrival on the scene is no great surprise — ASIC turned to the firm in May last year when it required an external law firm to help out in the market manipulation case against the four major banks.

But the question on many legal lips is why the transition has been made midstream, when senior counsel assisting Michael Hodge is preparing to apply the blowtorch to ASIC and prudential regulator APRA over their effectives as the nation’s superannuation watchdogs.

In his opening submission this morning, Hodge made an implicit reference to a regulatory gap.

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He noted that ASIC was not responsible for overseeing the compliance of directors with their separate obligations under the Superannuation Industry Supervision Act to act in the best interests of members.

ASIC, he said, had argued in its statement to the commission that it would need additional powers if it were to take on a greater role as the superannuation conduct regulator.

APRA had responded in its statement that its mandate to promote the stability of the financial system could be undermined if its powers to regulate conduct and practices in the super industry were reduced or removed.

Hodge noted the Productivity Commission’s draft report was critical of APRA’s behind-closed-doors supervisory activities.

According to the PC, poor behaviour at one fund might be shut down but the prospect of some wider industry deterrence was limited.

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