Why ASIC ignored repeated warnings on Crennan expenses

In a recent hearing of the parliamentary joint committee on corporations and financial services, committee chair and Liberal senator James Paterson raised a series of questions around how soon management within ASIC knew of potential breaches of Mr Crennan’s remuneration package.

A letter from auditor general Grant Hehir in October indicated the regulator was first requested in August 2019 to seek the tribunal’s review of Mr Crennan’s $750 per week accommodation payments, which had been funded by ASIC from 2018 onwards.

Responses to questions on notice from ASIC indicate that a further “internal briefing note” dated 7 May 2020 on “the issues associated with Mr Crennan’s rental assistance” were provided to “the accountable authority” on 11 May 2020.

“What the advice in May sought to raise is what the options were; what an application to the Remuneration Tribunal might look like and the merits of that, but also what the other options were,” ASIC chief legal officer Chris Savundra explained to Mr Paterson at the time of the hearing.

“But also, a critical aspect of any application to the Remuneration Tribunal is that it would require the support of the minister.” 

Further advice from the Australian Government Solicitor was also provided on 9 September, ASIC’s response stated.

A month later, on 15 October, the regulator stated it made the decision not to go to the Remuneration Tribunal around Mr Crennan’s expenses “following ASIC accepting Mr Crennan’s offer to voluntarily repay the rental assistance provided by ASIC”.

Following revelations at a hearing of the House economics committee later that month, an independent investigation into Mr Crennan and ASIC chair James Shipton’s expenses was launched, after it was revealed Mr Shipton had also charged almost $120,000 in accounting expenses to the regulator.

The next week, Mr Crennan announced he had brought forward his resignation from the position of ASIC deputy chair, which had been previously slated for July 2021.