The corporate regulator\u2019s new deputy leader says lawsuits and fines will remain critical tools in stamping out misconduct at the country\u2019s largest financial firms, as it works to wrap up the complex investigations stemming from the banking royal commission by the end of the year.<\/p>\n
Australian Securities and Investments Commission (ASIC) deputy chair Sarah Court said the regulator soon planned to finalise remaining investigations arising from the 2018 commission that exposed systemic misconduct at major banks, super funds and insurers.<\/p>\n
Ms Court said the types of misconduct that arose during the commission involved legacy systems that \u201cthrow up issues for both sides\u201d because they are complex and \u201ccan take a very long time\u201d to complete.<\/p>\n
<\/p>\n
ASIC deputy chair Sarah Court says lawsuits and fines will remain critical tools in stamping out financial misconduct.<\/span>Credit:<\/span>Ben Searcy<\/cite><\/p>\n \u201cI\u2019m very much hoping that by the end of this calendar year, we would have wrapped up the investigation phase of all the royal commission matters,\u201d Ms Court said. \u201cThere may still be the tail end of some of those, either with the Director of Public Prosecutions (DPP) with charges being laid or litigation in the court. But from an ASIC perspective, on the investigation side we [will] draw a line under it by the end of this year.\u201d<\/p>\n The Federal Court this week ordered Allianz Insurance to pay fines worth $1.5 million for selling travel insurance policies to ineligible customers and incorrectly stating premium prices on third-party websites such as Expedia.<\/p>\n Ms Court said Allianz\u2019s misconduct was \u201cnot deliberate conduct but the result of careless omissions and compliance failures\u201d and warned other financial institutions to fix longstanding policy or technology failures that lead to compliance breaches, or else they would be penalised.<\/p>\n \u201cWhether it be in relation to banking, or insurance, or super … We\u2019re very much hoping the various sectors are well on notice, now that [they know] these kinds of compliance failures are likely to result in these kinds of penalties and court outcomes being imposed.\u201d<\/p>\n Ms Court replaced former deputy chair Daniel Crennan, who stepped down after public and political backlash once it was revealed he was paid $70,000 in rental payments amid an expenses scandal at the regulator.<\/p>\n ASIC had been criticised for pursuing wasteful litigation that does not result in tangible outcomes, including its now-infamous \u2018wagyu and shiraz\u2019 case over responsible lending against Westpac that was ultimately unsuccessful.<\/p>\n The federal government has updated ASIC\u2019s mandate to focus on supporting the economic recovery from COVID-19. Ms Court said the regulator would continue to use litigation to send the message that finance firms \u201chave got to prioritise fixing up these systemic issues\u201d.<\/p>\n \u201cIt seems to me, here at ASIC, in the few months I\u2019ve been here, I\u2019ve seen repeated examples of what\u2019s broadly described as systems failures or compliance failures.<\/p>\n But the reality is those failures do have a direct impact on the consumers affected. They can\u2019t be dismissed as compliance failure.\u201d<\/p>\n \u201cSo we need to keep taking these kinds of actions to significantly encourage the prioritisation of fixing these legacy systems,\u201d she added.<\/p>\n The Business Briefing newsletter delivers major stories, exclusive coverage and expert opinion.<\/i><\/b> Sign up to get it every weekday morning<\/i><\/b>.<\/i><\/b><\/p>\nMost Viewed in Business<\/h2>\n
From our partners<\/h3>\n