Longo refuses to apologise to victims of Sterling collapse: ‘It’s emotionally inappropriate’

Following criticism in a Senate inquiry this week that ASIC was too slow to act on complaints about the Sterling Group – which eventually collapsed in 2019, leaving more than 100 customers facing possible eviction and heavy financial losses – chair Joe Longo acknowledged that more could have been done by the regulator at the time it received complaints.

“With the benefit of hindsight, we would have more closely engaged with the responsible entity on whether our concerns with the PDS were addressed,” he said.

“We may well have stopped the replacement PDS.”

However, when asked by senator Jordon Steele-John if ASIC would offer an apology to the victims, Mr Longo said it would not be “emotionally inappropriate”.

“At ASIC we do our best to look out for people who make investments… these individuals tragically made an investment,” Mr Longo responded.

“They signed a lease that was linked to an investment and that proved to be something that we now all know led to great losses for them personally.

“It’s emotionally inappropriate for me to say that ASIC should be apologising for that.

“I think what ASIC can say is that we’ve tried to respond to the issues that have been brought to our attention, tried to act in good faith, tried to be helpful to secure the interest of investors. But we now know that the tenant investors got caught up in a scheme that wasn’t sustainable.”

On Tuesday (16 November), Mr Longo admitted that ASIC received “two or three complaints or reports of misconduct… in late 2016, early 2017” however it did not become officially involved until a referral by the Western Australia Department of Mines, Industry Regulation and Safety in March 2017.

Mr Steele-John said the evidence shows that ASIC should have “acted quicker and shouted louder” when investigating the group.

Neil Griffiths

Neil is the Deputy Editor of the wealth titles, including ifa and InvestorDaily.

Neil is also the host of the ifa show podcast.