Senate votes to demand the federal Treasurer releases a review into ASIC chair’s conduct

The Senate has voted to demand the federal Treasurer hand over a review which was conducted into the chair of ASIC, Joe Longo.

Liberal Senator Andrew Bragg. Picture Kym Smith

The Senate has ordered the government to hand over an assurance review of Australian Securities and Investments Commission chair Joe Longo, as the corporate regulator faced criticism over claims it was acting with “contempt”.

In a motion put on Tuesday, the Senate voted to order the federal Treasurer to hand over a report about Mr Longo, who has faced accusations of an emotional outburst in an enforcement meeting in August 2022.

ASIC chair Joe Longo. Picture: Ian Currie

Treasury first assistant secretary Simon Winter conducted the review of Mr Longo.

Liberal Senator Andrew Bragg, who brought the motion, has repeatedly clashed with ASIC as the Senate Economics committee, which he is chairing, seeks to examine the effectiveness of the regulator.

Senator Bragg said ASIC was treating the Senate with “contempt”, which was making attempts to inquire into the regulator difficult “while this secrecy continues”.

“It is disappointing that the executive government believes that ASIC should be beyond reproach,” he said.

“It is clear that there are serious enforcement and governance issues at ASIC which have been covered up.”

Senator Bragg has taken issue with attempts by ASIC to block access to documents by claiming public-interest immunity.

He recently tried to make ASIC hand over documents relating to the watchdog’s investigations of companies Nuix, Magnis Energy Technologies and testing giant ALS.

Senator Bragg said ASIC was using public interest immunity claims to “cover up their past law enforcement inaction”.

“If we were seeking sensitive documents relating to current investigations, this would be understandable,” he said.

“We want to know why ASIC’s law enforcement is defective. This cannot be achieved without access to and inspection of ASIC’s internal investigation and prosecution processes.”

Senator Bragg said Mr Longo had also attempted to use public interest immunity claims to block the release of an internal investigation into ASIC deputy chair Karen Chester.

“ASIC has been covering up this investigation since I first asked ASIC chair Joe Longo about it during Senate estimates in February 2023,” he said.

“The public deserves to know what allegations were made against ASIC’s deputy chair, and what actions were taken where $200,000 of taxpayers funds was expended on a secret investigation,” he added.

ASIC deputy chair Karen Chester. Picture Gary Ramage

The Australian revealed on Monday that Ms Chester had exchanged a large number of messages on WhatsApp with short seller and Bronte Capital boss John Hempton over several years.

Ms Chester declared three messages from Mr Hempton to ASIC at the beginning of 2022 and Mr Hempton has claimed she has cut off communication with him.

Mr Hempton has also confirmed he has emailed Ms Chester on several occasions, including in November 2019 when he contacted her regarding Mayfair 101.

Senior ASIC figures in the regulator’s investment managers team, not including Ms Chester, began discussing whether to issue a warning about Mayfair 101 the day following Mr Hempton’s email.

Ms Chester was reportedly not aware of plans to issue a warning about Mayfair in November 2019.

However, Ms Chester played a key role in the Mayfair case, as the regulator assembled a team to track the issue under its true-to-label initiative.