1.6 ASIC Enforcement Review

On 19 October 2016, the Minister for Revenue and Financial Services appointed a Taskforce to conduct a review of ASIC’s enforcement regime (the Enforcement Review).

The Terms of Reference required the Taskforce to examine relevant Commonwealth legislation to determine the adequacy of, among other things: the civil and criminal penalties for serious contraventions relating to the financial system; existing penalties for serious contraventions; enforcementrelated licensing powers; ASIC’s power to ban company officers; ASIC’s information gathering powers; and the frameworks for notifying ASIC of breaches of law.[1] The Taskforce was required to identify any gaps in ASIC’s powers and make recommendations to the Government to address gaps or deficiencies it identified in a way that would allow more effective enforcement of the regulatory regime.[2]

The Taskforce issued its report in December 2017. It made 50 recommendations.[3] The recommendations included reforming section 912D of the Corporations Act 2001 (Cth) (the Corporations Act) (about reporting significant breaches, or likely breaches, of certain provisions); strengthening ASIC’s licensing and banning powers; increasing penalties for contraventions; and giving ASIC a new directions power.[4]

On 16 April 2018, the Government published its response to the Taskforce’s final recommendations, in which it agreed, or agreed in principle, to all 50 recommendations. Implementation of some of the recommendations was deferred pending the work of this Royal Commission. I deal separately with those recommendations in the chapter about other important steps.

When implemented, the recommendations of the Enforcement Review will provide ASIC with considerable new or enhanced powers and will lead to significant increases to the maximum penalties that may be imposed for breaches of financial services laws.

[1] ASIC Enforcement Review, Report, ix.

[2] ASIC Enforcement Review, Report, ix.

[3] ASIC Enforcement Review, Report, xivxviii.

[4] ASIC Enforcement Review, Report, xivxviii.