Levy responds to reader comments, says they informed the review

Speaking at an event in Sydney on Tuesday evening hosted by communications agency PritchittBland, Ms Levy said she waded through multiple comments on news articles critiquing her work as the QAR reviewer.

“I found them compelling. I couldn’t stop,” Ms Levy said with a laugh.

Comments she found particularly intriguing, she said, include those accusing her of not paying enough attention to the reasons behind the current regime’s existence and the overwhelming “prescription” in the regulatory framework.

“I think in large part this [the comments] is because of the proposals paper and the kinds of comments that I make in forums like this. What I want to say is that what I have recommended is based not only on an intimate knowledge of the existing regime but living through all of the events that have led to it. The crimes and misdemeanours,” Ms Levy explained.

This, she noted, does not mean that the regime should remain as it is.

“The financial services regime has been built in response to a series of scandals that have harmed consumers. Each reform is built on the other and each reform is followed by yet another scandal event that leads to consumer harm,” Ms Levy said.

“What we do have now though, I think, is a broader base of consumer protection law. We’ve always had misleading or deceptive conduct laws, but I think the courts and ASIC are willing to really apply them to financial services and advice,” she added.

Citing higher penalties, more active regulators, and the incoming Financial Accountability Regime, Ms Levy said these form “a very sound basis” for the industry to move away from the “prescription that we have in the current law”.

“I understand that in some respects what I have recommended and what you haven’t seen yet is quite hard, and I think, I don’t know, but I suspect that might be another reason why the report hasn’t been released yet,” Ms Levy said.

“In saying that, I am not encouraging the Minister to hurry because I am enjoying this break.”

Ms Levy also told the event that modest changes would not make financial advice widely available, hinting that her report is quite detailed and demands comprehensive reform.