ASIC warning – get DDO right from day one
The Australian Securities and Investments Commission (ASIC) has signalled a no-nonsense approach to enforcing its design and distribution obligations (DDO) stating it “expects compliance with DDO from day one”.
The regulator’s apparent hard-line approach had been outlined by ASIC commissioner, Sean Hughes to a Credit Law Conference where he suggested that firms should already be investing in the necessary technology and systems to underpin DDO.
“ASIC expects compliance with DDO from day one,” he said. “Not in a ‘tick-a-box’ way, but compliance in a way that meaningfully improves outcomes for consumers.”
“Ultimately, this means firms will need to understand their products and the outcomes they are delivering to consumers. In order to do this, industry needs to invest in the data systems now and ensure that they are properly able to monitor the outcomes of their products come 5 October next year.”
Hughes said that ASIC would be releasing its final guidance around DDO soon but noted that the DDO approach represented a step-change in financial services regulation, placing greater responsibility on issuers and distributors of financial products to appropriately design and distribute those products.
Recommended for you
The Governance Institute has said ASIC’s governance arrangements are no longer “fit for purpose” in a time when financial markets are quickly innovating and cyber crime becomes a threat.
Compliance professionals working in financial services are facing burnout risk as higher workloads, coupled with the ever-changing regulation, place notable strain on staff.
The Senate economics legislation committee has recommended Schedule 1 of the Delivering Better Financial Outcomes legislation be passed as it is a “faithful implementation” of the recommendations.
Treasurer Jim Chalmers has handed down his third budget, outlining the government’s macroeconomic forecasts and changes to superannuation.
