Released today, ASIC’s Annual Report outlines ASIC’s key regulatory and enforcement outcomes for 2021–22. Australia’s corporate and markets regulator continued to take strong and targeted action against misconduct harmful to consumers and the integrity of the financial services sector.
ASIC secured $229.9 million in civil penalties during the 2021-22 financial year. In addition, ASIC secured convictions against 33 individuals.
ASIC Chair Joe Longo said the Annual Report covered a year of significant law reforms following on from the Financial Services Royal Commission.
‘We have worked with industry to bed down significant reforms which offer consumers and investors greater protection from poor behaviour, through more rigorous accountability and obligations on providers of financial services,” Mr Longo said.
‘The magnitude of harm revealed during the FSRC and other recent inquiries has led to a considered expansion of the tools we have available to detect and deter wrongdoing in this sector.”
Significant new obligations in ASIC’s regulatory environment introduced in 2021-22 include:
- design and distribution obligations, focused on protecting consumers’ interests and reducing the risk of harm caused by poor design, distribution and marketing
- the breach reporting regime, which recognises the important role that licensees have in identifying and reporting breaches in a timely manner and provides a critical source of intelligence for ASIC
- the hawking prohibition, which is designed to tackle consumer harms arising from consumers being approached with unwanted products through cold-calls or other unsolicited contact
- deferred sales model aimed at improving consumer outcomes in the add-on insurance market.
‘Looking ahead, our Corporate Plan flags our near-and-medium-term priorities to focus on areas of increasing risk of consumer harm, including greenwashing claims and crypto investment scams. It also sets out our sharpened focus on the superannuation industry and our international work supporting consistency in standards of climate change and sustainability reporting by corporations.’
Editor's note:
ASIC retracts the statement about the proceedings commenced against Sunshine Loans Pty Ltd on page 71 of the Annual Report. To clarify, in its proceedings against Sunshine Loans, ASIC alleges that Sunshine Loans charged consumers additional fees, not permitted by the Code, in the form of an amendment or rescheduled payment fee. ASIC corrects the statement with the following:
On 6 June 2022, ASIC commenced action against Sunshine Loans Pty Ltd, in which ASIC alleged Sunshine Loans had received payment of $327,845.00 in prohibited fees from consumers in relation to small amount credit contracts. The National Consumer Credit Code limits the fees that may be charged under these loans to an establishment fee, monthly fees, a fee or charge that is payable in the event of a default and a government fee, charge or duty payable in relation to the contract. ASIC alleges that Sunshine Loans charged consumers additional fees, not permitted by the Code, in the form of an amendment or rescheduled payment fee.
ASIC will also publish a correction in next year’s annual report.