Effective enforcement action is a critical task of consumer protection regulators and essential to a well-functioning consumer market. In recent years, ASIC has completed a significant amount of meaningful enforcement work that has been targeted at unethical, unprofessional and/or unlawful businesses causing harm to consumers. ASIC’s interventions have improved consumer outcomes in financial services, provided valuable guidance to industry on the laws that apply to their businesses, and led to a more competitive marketplace.
ASIC’s use of the various forms of enforcement powers in their toolkit is generally appropriate for the circumstances. We encourage ASIC to continue to use the variety of powers at their disposal and take a campaign approach toward compliance and enforcement. In particular, we encourage ASIC to continue to expand the thematic and detailed reviews of the industries it regulates, particularly higher risk areas.
To empower ASIC to deliver more effective outcomes from its investigations and compliance work, we recommend that Government:
• amend ASIC’s legislative objectives to specifically reference its role in promoting fair treatment for consumers experiencing vulnerability
• increase ASIC’s funding, particularly to allow it to do more ongoing data collection and analysis
• develop a mechanism by which ASIC and Treasury can proactively identify and respond to any problematic conduct that falls on the edge of ASIC’s regulatory perimeter
• introduce an unfair trading prohibition and give ASIC the power to enforce this provision in relation to financial services
• introduce a super-complaints power similar to the one in the UK
• align penalties in relevant ASIC legislation to those in the Australian Consumer Law (ACL).
We also note that ASIC already has significant reporting obligations to Parliament. While accountability is important, increasing layers of oversight across multiple committees does not seem to add a lot of value. It also detracts from ASIC’s core functions as it requires significant resourcing internally. If any increased accountability were to be recommended, it should only relate to publishing better information for the general public.
Read the full submission PDF.230228 Submission – Senate Eco – ASIC capability- FINAL