Appearing before the House standing committee on economics last week, the Australian Securities and Investments Commission (ASIC) said it has prioritised working with industry organisations in order to take their specialist expertise on board.
ASIC chair Joe Longo said the regulator has put a focus on “having a systemic impact and solving problems”.
“We’ve really upped our engagement with industry and industry organisations across the economy,” Longo told the committee.
Deputy chair Sarah Court added that it is an area that ASIC is “making a big effort to uplift and improve”.
“An area have been working on, and I think making some progress on is … really improving the way we interact with professional associations,” Court said.
“We do receive assistance and information from a range of professionals. And in the past, again, there has been some criticism that we have not fully engaged and been fully receptive to their specialist expertise.”
Responding to questions from Liberal MP Bert van Manen, Court also acknowledged that the regulator’s engagement with reporters of misconduct also requires improvement.
“The first thing I should acknowledge is we have discussed this issue and been aware of concerns from reporters of misconduct to ASIC of a perception that we’re not engaging with them or giving them sufficient information in response to their reports,” she said.
“It’s something we take seriously, and we have been doing a lot of internal thinking and work into how we address that.”
However, she noted that given the high level of misconduct reports, there are “a few challenges”.
“We receive in the order of 10,000 reports of misconduct from a range of sources every year, and we triage those, we have a very experienced triage area that triages them and tries to make quick assessments as to which of those reports need immediate and urgent action,” Court said.
She added: “We are simply not resourced to have continuing engagement with people that refers matters to us at a high level.”
According to the deputy chair, ASIC is also in “dire need of a technology investment”, which would also help with engaging with reporters of misconduct.
“Improving the way that we interact with and respond to reporters of misconduct is an area that we have regularly received feedback in relation to, that we recognise we have to continue to lift and improve the way that we do that. Some of that is also dependent on being able to uplift those systems to enable us to engage more efficiently, but it’s certainly something that we are really working on very hard that,” Court said.
She added that the broader industry has also called for greater transparency around the nature of the complaints, how ASIC engages, as well as the reasoning for which complaints are actioned.
“We are again doing some work internally to really think about how we might improve our transparency in relation to those reports,” Court said.
“So, they are some of the things that we have formed a view that we need to work on.”
It’s difficult to know whether to laugh or cry at this comical performance from ASIC.
We can solve the problem of ASIC’s interaction with professional associations by doing what should have been done years ago – allow the industry to become a profession and self-regulate. Problem solved. And it would free up ASIC resources to focus on things like reported misconduct and maybe prevent the next Dixon Advisory fiasco rather than deal with the carnage.
In the meantime, if ASIC is serious about “having a systemic impact and solving problems” they could take Recommendation 9 of the QAR seriously and announce that they will not apply compliance resources to the current requirement to provide Statements of Advice. Simply require advisers to provide documents to clients that meet their r obligations under the Code of Ethics. In other words, require us to do nothing more or less that what other professionals are obliged to do. Simple. And it would have an immediate “systemic impact and solve problems.”
I have put this to ASIC directly in the past – to no avail. There is a chasm between what ASIC says, and what ASIC does. If ASIC was my pet, as an act of pure mercy, I would have it put down.
David Smith. Financial Planner. Darwin.
So ASIC doesn’t have the resources to follow up on reports of real misconduct causing genuine consumer harm, but they have plenty of resources to persecute innocent professional advisers over minor administrative issues that cause no consumer harm whatsoever?
“We are again doing some work internally to really think about how we might improve our transparency in relation to those reports,” Court added
I have this picture – feet up on the desk – thinking they are?
ASIC thinking includes a 2 day offsite conference on how they can get their 1984 green screen IBM PC-AT computers to run faster so as to help them become more efficient in the modern world…