ASIC court action reaps $927,203,000 over eight years
As financial advisers worry about the cost of the Compensation Scheme of Last Resort (CSLR), the Australian Securities and Investments Commission (ASIC) has revealed its involvement in extracting Court ordered pecuniary penalties of close to $700 million over eight years.
The regulator has told Senate Estimates that between 2017-18 and 2025-26 (to 30 September 2025) there were 78 proceedings where ASIC and the defendant jointly submitted to an agreed position to the Court at Trial.
It said the Federal Court ordered a total of $691,680,000 in pecuniary penalties in those proceedings.
The data provided by ASIC revealed that the most active years in terms of extracting major pecuniary penalties were between 2020-21 and 2022-23.
Just as importantly, the ASIC data reveal that when taken together with the other penalty proceedings, the total penalties ordered amounted to $927,203,000.
Answering a question on notice from Tasmanian Greens Senator, Nick McKim, ASIC said that in regulatory proceedings, it generally sought declarations from the Court confirming whether certain conduct contravened the law, and orders for the payment of pecuniary penalties.
“The regulator and the defendant cannot ‘settle’ these proceedings in the way that private litigants can,” it said.
“Consistent with the approach taken by other regulators, when ASIC and the respondent reach an agreed position about what declarations and penalties (and or other relief) might appropriately be ordered, they must put agreed facts and admissions before the Court and the Court must be satisfied that facts exist to justify the declarations and that the amount of the penalty is appropriate.
“This may occur at commencement or throughout proceedings. An agreed position can be limited to liability or both liability and penalties (and or other relief). An agreed position on penalty (and or other relief) can also be put to the Court following a Court finding on liability.
“ASIC will only agree to resolve proceedings with agreed submissions where it considers the declarations and penalties are appropriate having regard to fulfilling its regulatory remit to address misconduct and provide deterrence and having regard to relevant factors and precedent.
“Where these conditions are met, resolution by agreed submission can support resolution in a timely manner including facilitating other relief, supports efficient use of limited Court resources and allow ASIC to direct resources to other matters of harm,” the regulator said.
….and bugger all of that was ever from unionised industry superfunds! Not because, as they would have you falsely believe, they have impeccable governance, compliance and best duty top of mind, but because they have ASIC fairly in their pocket (deep pockets filled with superfund member money paying their ‘fees’) with APRA, the toothless tiger it is, closely behind. This zoo is filled with regulatory capture, and is the ISA’s little petting zoo!
Incredible that regulators are raking in hundreds of millions from the guilty, yet they force the innocent to pay compensation for those affected by wrongdoing.
The system is utterly broken. This doesn’t need a “Review” or “Consultation”. It needs immediate action to fund the CSLR 100% from accumulated ASIC fines.
And how much has been applied to offset the ASIC Adviser levy as we were told would happen ? $ None
Advisers are ASICs litigation funders but get zero reward or levy offset when ASIC bank $$$1 Billion in fines.
Where’s all the court cost payments from these cases ?
If you are a certain type of trustee, you can negotiate your fine with ASIC as to be conscious of your member outcomes. (I.e. get a watered down fine because your members have to pay for it anyhow)
Meanwhile, hammer advisers with the CSLR and ASIC fees, whilst also hammering retail trustees with proper penalties.
Fine revenue paid elsewhere, not offsetting costs for advisers.
Australia would be the only country in the world where you’d see such an observation.
Two-tiered system. Totally unfair and frankly unsuitable for purpose.
Needs a Royal Commission and a reboot. Current system complete garbage with too much influence from friends and fellow travelers.
If I’ve got this wrong, let me know.