Civil penalties for white-collar crime in Australia are not “strong enough”, making it a “paradise” for fraudulent financial planners, according to the head of ASIC.
Greg Medcraft said the regulator had conducted a review of international corporate crime penalties, revealing Australia was well behind its peers, The Australian reported.
Medcraft said ASIC has been urging the government to implement legislative changes citing the lack of knowledge and education levels of financial planners as a “key” concern when considering improving consumer protection.
“In Australia it’s worth breaking the law to do the trade, it’s a big problem,” he said.
“In many cases all we do is give a slap on the wrist and it’s not discouraging bad behaviour.”
Earlier this year ASIC warned consumers of the low frequency of policing financial planners — on average once every 30 years – and the fact penalties were not adjusted for inflation.
“In Australia we haven’t indexed penalties to inflation for 20 years,” Medcraft said.
“Civil penalties for white-collar offences are just not strong enough.”