ASIC probed on ‘why not litigate’ future
The corporate watchdog has said it would be looking at its enforcement settings as its priorities has changed but that it intended to be an active litigant if needed.
That Australian Securities and Investments Commission (ASIC) was probed by a parliamentary committee on whether it would continue its “why not litigate” regime following the commencement of its new chair, Joe Longo.
In his opening statement, Longo said the commission was entering a new phase of its enforcement and regulatory work as it was finalising enforcement actions arising from the Hayne Royal Commission.
Longo was asked whether ASIC’s approach to enforcement would change given his new role.
“For my part one of the things I’m working with the other commissioners is what our enforcement settings should be in the next couple of years because our priorities have changed,” he said.
“Our commitment to enforcement will not change but the critical question is what enforcement, what cases do you run, what investigations do you launch – those are the critical questions. And then I can reassure the committee we intend to be an active litigant in furtherance of those objectives.”
ASIC deputy chair, Sarah Court, noted that when deciding on what action to take from its toolbox – including infringement notices, undertakings, other new powers ASIC had recently been given, criminal proceedings, and civil litigation – the commission needed to make sure the action was proportionate and that it needed to be an efficient and timely use of its resources.
Responding to this, Labor Senator Deborah O’Neill pointed to instances when ASIC did not go ahead with court cases as cost was a prohibitive factor and that this did not meet community expectations.
ASIC deputy chair, Karen Chester, said the commission had been using “express investigations”.
“An effective regulator means using all the toolkit but when we are we use it in the least cost way. Express investigations have resulted in a reduction in cost for the entities involved in 70% of legal fees,” she said.
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