Federal Treasurer Josh Frydenberg says the Australian Securities and Investments Commission is “perhaps too close” to the financial services sector it polices.
In an exclusive interview on TICKY on Monday, the treasurer was asked whether ASIC suffers from “industry capture” and is too close to the industry it is tasked with regulating.
“Certainly they have been close to industry,” Frydenberg said. “From what has come through in the [royal commission interim] report it’s clear that perhaps too close.”
He also said ASIC was lenient with offenders despite a high success rate in court.
“What we know is that ASIC has had a very high success rate with the cases that they’ve taken through the courts, a more than a 90 per cent success rate,” Frydenberg said.
“But they preferred to negotiate or to put in place infringement notices or issue a press release rather than take the necessary next step which is to prosecute.
“This is something no doubt they will work closely with the Commonwealth DPP on.”
Frydenburg told Ticky the interim report was a “frank and scathing assessment of culture and compliance in the sector” and Commissioner Kenneth Hayne sent a strong message to the industry that more and better enforcement needs to take place.
Noting a rise in bank share prices after the interim report was released on Friday, Ticky remarked “the banks all seem pretty happy there won’t be any new major regulations”.
Frydenberg responded that the banks “must have had low expectations”.