ASIC will be the ‘tough cop’ on the banks

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ASIC chairman Greg Medcraft has styled his corporate watchdog as the tough cop on the financial beat.

The federal government announced $127 million in additional funding today to go after misconduct among the banks, a move seen as a counter to Labor’s election promise of a royal commission.

“We are willing to take anyone one, no matter how big you are,” Medcraft told Sky News.

The banking industry has been subject to several scandals recently including poor financial advice to customers, restricting payouts for disability insurance claims and allegations of rigging the bank bill swap rate.

At a media briefing, Medcraft said: “With these additional resources ASIC will be even more pro-active in cracking down on wrongdoing. We are the tough cop on the beat.”

The banks have been criticised for a culture of greed, including by prime minister Malcolm Turnbull who says they need to get away from being motivated only by profit and high salaries.

Asked if what he will be doing will change culture at banks, Medcraft replied that culture is the mindset of the entity.

“There are many things that affect that mindset and culture is something you can’t regulate,” he said.

“You can incent good behaviour. Some people unfortunately are driven by incentives, either positive or negative.

“Remuneration is something and I think it is something the banks are engaging with. Some people unfortunately are actually driven by the probability and what happens if you get caught breaking the law.”