ASIC confirms degree to which associations dob bad behaviour

The Australian Securities and Investments Commission (ASIC) has revealed the degree to which professional bodies, including the Financial Advice Association of Australia (FAAA) have sought to use the regulator to underpin their disciplinary regimes.

ASIC has told the Senate Economics References Committee that it has received complaints “from four professional bodies that have disciplinary functions”

It named those professional bodies as being the Australian Restructuring Insolvency and Turnaround Association (ARITA), the Tax Practitioners Board, the Mortgage and Financial Association of Australia and the FAAA.

ASIC said that in the current financial year to date, it had received 14 complaints from these professional bodies.

“Nine complaints were received from two industry and professional bodies in the previous financial year 2021/22. Three reports received since May 2023 are still under assessment.”

“These reports provided intelligence on a variety of topics including unlicensed financial advice, scams, information about members of the regulated population, including registered liquidators and mortgage brokers, and issues falling outside of ASIC’s powers.”

“For all finalised reports, ASIC assessed the reports and made further inquiries or took action in relation to nine of the reports received in FY23 to date and FY22.”

“These reports provided new and specific information about a regulatory issue within a current strategic or enforcement priority. In appropriate instances, ASIC issued warning letters reminding subjects of the requirement to be licensed or authorised to provide financial advice or services within Australia,” ASIC told the Senate Committee.

The remainder were assessed and recorded for intelligence purposes, however no specific action was taken for a range of reasons including:

– the information related to breaches outside of ASIC’s jurisdiction;

– the report alerted ASIC to publicly available information;

– the subject had disciplinary action taken against them, were no longer in the industry and ASIC action was not warranted; or

– the report provided no new information to ASIC involving a matter already investigated.