ASIC asleep at the wheel – AIOFP
The Australian Securities and Investments Commission (ASIC) was ‘asleep at the wheel’ on Shield and First Guardian and needs to accept its share of blame, according to a letter from the Association of Independent Financial Professionals (AIOFP) to parliamentarians.
At virtually the same time as ASIC Commissioner, Alan Kirkland was outlining the regulator’s actions with respect to the collapse of Shield and First Guardian, AIOFP executive director, Peter Johnston sent a letter to parliamentarians stating that ASIC’s failings should not be overlooked.
The letter noted that ASIC had been warned on at least two occasions in 2023 but failed to act.
“This unfortunately allowed another $526 million of Consumer savings to be allocated
Johnston’s letter states that AIOFP cannot understand why ASIC did not take advantage of Section 920A[1][ba] of the Corporations Act which gave it power to act if they ‘believe’ or think it ‘is likely’ persons are contravening the law.
“If they had acted when alerted this matter could have been largely avoided. The perpetrators actions would have been frozen until ASIC could further investigate the circumstances. This Law gives ASIC extraordinary powers to intervene in any commercial matter,” the letter said. “The question needs to be asked why ASIC did not implement this approach? “
“ASIC is silent on this issue but it is obvious they need to start employing ‘street smart’ lawyers instead of the inexperienced or bureaucratic Lawyers who are removed from or never been in the ‘real commercial world’.”
“The common political response is more regulatory power, but ASIC have ample already, the harsh reality is the ASIC senior management are predominately all career Bureaucrats who don’t fully understand the commercial market and behave accordingly.
“This needs to change to protect consumers and the Advice Profession going forward,” the letter said.
Asleep at the wheel, or deliberately sitting on their hands?
ASIC seems quite happy to allow consumers to be harmed by rogue advisers, because it gives them ammunition to vilify and persecute the honest majority of advisers.
Hmm… I always say follow the money. An investigation will always generate more income than preventative action.
Asleep??? Comatose more likely.
Dixon, Storm etc etc
Incompetent, lazy, culpable and pathetic are just a few of the words the editor will actually publish about ASIC. Complete buffoonery.
Surely the AIOFP aren’t throwing barbs at ASIC for this when it was there members were the perpetrators?
If ASIC were asleep at the wheel what the help does it make the AIOFP
I am speechless
I don’t usually agree too often with the AIOFP but I do here.
There needs to be accountability on ASIC.
Dixon, Shield, First Guardian all very poor outcomes.
Meanwhile advice practices are fined heavily for small clerical errors and paraded around in press releases.
It really is an absolute farce.
Well said, AOIFP. ASIC see this as a grand opportunity for scalps but they need to check themseves. I know the ratings house concerned certainly wished they had the warnings ASIC received.
A very good point.