ASIC needs cost-benefit analysis of actions
A Parliamentary Committee has been told the Australian Securities and Investments Commission (ASIC) should be more considerate of the time and resources its requirements place on businesses.
In a submission to the a Parliamentary Committee earlier this month the Rule of Law Institute of Australia (ROLIA) made specific reference to a lengthy questionnaire sent by the regulator to some of the largest Australian Financial Services Licensees (AFSLs) last year.
The committee was told the questionnaire comprised of a 812-question document which was issued to up to 30 of the largest institutionally owned and independent dealer groups under a Notice of Direction making completion compulsory.
The ROLIA told the committee that this reflected a particular use of ASIC’s coercive powers.
Pointing to the amount of time and resources that needed to be directed to the exercise, the ROLIA submission argued that ASIC should consider voluntary surveys first and should seriously test the costs and benefits of complex and onerous data collection.
The ROLIA evidence to the parliamentary committee referenced ASIC’s own data with respect to its use of coercive powers, saying the five most frequently used powers by ASIC over the period 1 July 2007 to 17 June 2010 were: Section 33 of the ASIC Act – notice to produce documents in person’s possession (6,984 occasions); Section 30 of the ASIC Act –notice to produce books about affairs of body corporate or registered scheme (5,687 occasions); Section 19 of the ASIC Act – notice requiring appearance for examination (3,354 occasions); Section 31 of the ASIC Act – notice to produce books about financial products(1,430 occasions); and Section 912C of the Act – direction to provide a statement (939 occasions).
AUTHOR
Mike Taylor
Recommended for you
ASIC has cancelled a Sydney AFSL for failing to pay a $64,000 AFCA determination related to inappropriate advice, which then had to be paid by the CSLR.
A former Brisbane financial adviser has been charged with 26 counts of dishonest conduct regarding a failure to disclose he would receive substantial commission payments for investments.
Inefficient data processes and systems mean advisers are spending over half of their time on product implementation and administration at the expense of clients, according to research.
With the regulator announcing its enforcement focus for 2025 last week, law firm Hall & Wilcox examines the areas which have dropped down the list in priority for the regulator.
