Avoiding FAR duplication with ASIC and APRA
The Australian Prudential Regulation Authority (APRA) and the Australian Securities and Investments Commission (ASIC) will have defined roles with responsibilities, supported by processes and procedures, under the Financial Accountability Regime (FAR).
APRA’s executive director, Sean Carmody, answering the question from Senate Economics Legislation Committee chair, Senator Paul Scarr, regarding the division of responsibilities between the two institutions, told the committee that the responsibilities of regulators would not be duplicated under the new Financial Accountability Regime (FAR).
“We are very conscious that there is certain information industry has to provide as part of being compliant with FAR and clearly we don’t want to have a regime [that] is going to have a duplicate reporting to multiple agencies,” he said.
“We are making it very clear that there is a single portal for provisioning this information which is going to be a recently-implemented system called APRA Connect which was implemented last year for a collection of a wide range of data, not just the FAR.
“We’ve got processes behind that system that automatically have that information disseminated through to ASIC as well and are both receiving the same information of the essentially at the same time.”
At the same time, he said that both regulators would need to have proper communications and co-ordination, in particular around the overlapping areas.
“Prudential matters would still sit with APRA and conduct-related matters would still sit with ASIC but there would always be matters that would blur between the two,”
Answering the question on a duplication of overlapping obligations, ASIC’s senior executive leader, strategy group, Greg Kirk, said there were two types of breaches which included a breach of a requirement to have internal accountability arrangements and the underlying conduct rules.
However, he stressed, the regimes would be looking at different things.
“So, the existing conduct laws administered already around the conduct involved whereas the FAR regime is to have clarity about the accountability and the background for full conduct so people know who is responsible.
“They have measures in place including the renumeration to manage it within the organisation.
“And again it does not necessarily mean that there has been a breach of FAR but it means they will be quick to identify who in the organisation is responsible for that activity and who we need to speak to about it.”
AUTHOR
Oksana Patron
Recommended for you
The new financial year has got off to a strong start in adviser gains, helped by new entrants, after heavy losses sustained in June.
Michael McCorry, chief investment officer at BlackRock Australia, has detailed how investors are reconsidering their 60/40 portfolios as macro uncertainty highlight the benefits of liquid alternatives.
Having reset its market focus to high-net-worth advisers, Praemium’s administration solution has been selected by Bell Potter in a deal that increases the platform's funds under administration by $6 billion.
High transition rates from financial advisers have helped Netwealth’s funds under administration rise by $3.7 billion in the fourth quarter of FY25.
