Effectiveness of Australian Securities and Investment Commission (ASIC)

ASIC 1
Effectiveness of Australian Securities and Investment Commission (ASIC)
Name of Student
Institution affiliation

ASIC 2
Table of Contents
Abstract............................................................................................................................................3
Introduction......................................................................................................................................4
Thesis...............................................................................................................................................4
Background......................................................................................................................................4
The Effectiveness of ASIC and Areas of Focus..............................................................................5
Scrutiny of Remediation Programmes and Processes..................................................................5
Effectiveness of ASIC’s Enforcement Approach.........................................................................6
Lack of System and Processes......................................................................................................6
Effectiveness of Breach Reporting...............................................................................................7
Consumer Control and ASX.........................................................................................................7
Skills of market Regulation..........................................................................................................8
Effectiveness of Auditing.............................................................................................................8
Integrity Arrangements.................................................................................................................9
Conclusion.....................................................................................................................................10
References......................................................................................................................................11
Legislation..................................................................................................................................11
Books/ Reports/ Journal articles/ Web sources..........................................................................11

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Abstract
Australian Securities and Investment Commission (ASIC) is a unified regulator for commercial
markets, financial services and a customer credit watchdog in Australia. It controls Australian
corporations, financial services companies, markets, and experts dealing with insurance, deposit
taking, credit, superannuation and investments. The effectiveness of ASIC depends on how it
serves the functions provided under the ASIC Act, which instituted it and the Corporation Act
which it serves under. According to the Parliamentary Joint Committee on Corporations and
Financial Services, ASIC’s performance has been subject to intense debate and enquiry since the
Global Financial Crisis. The final report by Hayne Royal Commission criticized the role of
Australian Securities and Investment Commission in failing to inhibit delinquency in financial
services, especially its professed preference for resolving contravening conduct by agreement
and not by setting up proceedings. Issues of enforcement, auditing, integrity, skills of market
regulation, consumer control, scrutiny of remediation programmes and processes prevail in
showing the efficiency of ASIC
Keywords; ASIC, ASIC Act, Corporation Act, financial services, financial services
organisations, Remediation, CCM.

ASIC 4
Introduction
Australian Securities and Investment Commission (ASIC) is an integrated regulator for business
markets, financial services and a customer credit supervisor in Australia1. The commission acts
independently of the commonwealth Government. It standardizes operations of Australian
corporations, financial services companies, markets, and specialists dealing with insurance,
deposit taking, credit, superannuation and investments. ASIC was put in place by the ASIC Act
20012 and performs its duty under the Corporation Act 20013. Some of the laws (or their relevant
parts or regulations) the commission administers include, “Insurance Contracts Act 1984,
Business Names Registration Act 2011, Life Insurance Act 1995, National Consumer Credit
Protection Act 2009, Medical Indemnity (Prudential Supervision and Product Standards) Act
2003, Business Names Registration (Transitional and Consequential Provisions) Act 2011,
Superannuation (Resolution of Complaints) Act 1993, Superannuation Industry (Supervision)
Act 1993, and Retirement Savings Accounts Act 1997”4.
The effectiveness of ASIC depends on how it serves the functions provided under the ASIC Act.
Some of these functions as stated by the ASIC Act are the maintenance, facilitation and
improved financial structure and units in it, indorsing well-versed engrossment by investors and
customers within the financial system availing information about companies to the public,
among others5.
Thesis
What this paper aims to do is reviewing the comments effectiveness that were put forward by the
Hayne Royal Commission and others regarding ASIC performance.
Background
Part 14 of the ASIC Act 2001 establishes the Parliamentary Joint Committee on Corporations and
Financial Services. The committee assessed the effectiveness of AISC as per the provisions
1 Walter Mattli, Global Algorithmic Capital Markets. High Frequency Trading, Dark Pools, And Regulatory
Challenges (Oxford University Press, 2019).
2 Australian Securities and Investments Commission Act, 2001 (Cth)
3 Corporations Act 2001 (Cth)
4 "About ASIC | ASIC - Australian Securities And Investments Commission", Asic.Gov.Au (Webpage, 2016)
<https://asic.gov.au/about-asic/>.
5 "About ASIC | ASIC - Australian Securities And Investments Commission", Asic.Gov.Au (Webpage, 2016)
<https://asic.gov.au/about-asic/>.