- ASIC is creating a hit team of 20 officers to work inside the big banks and AMP.
- The team could spend days, weeks, or months looking at governance and compliance issues.
- The new focus will start soon with emphasis on governance structures and a particular focus on breach reporting.
Corporate regulator ASIC is building a team of up to 20 people to work inside the big four banks and AMP, sometimes spending months looking at governance and compliance issues.
The Federal Government on Tuesday announced special funding of $8 million to implement a new approach, a form of embedding, for supervising Australia’s five largest financial institutions.
The money was part of $70.1 million for ASIC to ensure the corporate regulator has the resources and powers it needs to combat misconduct in the financial services industry.
The announcement spurned a series of questions: whether ASIC investigators would sit in on board meetings; get their own offices; attend senior executive get togethers; or just do a bit of free range hunting down the hallways of Australia’s biggest financial institutions.
James Shipton, ASIC’s new Chairman, says the teams will be spending significant amounts of time inside financial institutions.
“That may be days, may be weeks, may be months, depending on the project at hand, depending on the task at hand and depending on the harm that we’re trying to solve for,” he says.
“In answer also to the question about their engagement, they will be engaging at every single point in a financial institution to provide that effective regulatory coverage.
“That could be the CEO, it could be the chair, all the way through to the men and women who are in the particular business unit.”
The response from ASIC will depend on the challenge and task at that time.
“But we will be initially starting, very soon, in the weeks ahead, with a particular focus on governance structures and a particular focus on breach reporting,” says Shipton.
He says it took four years on average for financial institutions to discover the current misconduct.
And then 123 days on average for that misconduct to be reported.
“That’s too long,” he says. “That’s going to be an initial focus for us. “
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