ASIC’s recent Enforcement Update demonstrates that it is in a strong position to identify and disrupt misconduct across the Australian financial sector through aggressive enforcement action.
The Australian Securities and Investments Commission (ASIC) recently released its Enforcement Update for the period from July-December 2020. There were no signs of ASIC slowing down its enforcement activity, particularly its pursuit of court-based outcomes, despite the challenges of the pandemic.
Record civil penalties imposed by courts
ASIC’s enforcement report demonstrates that it has used its increased resourcing to pursue and secure court-based outcomes.
The headline outcome for ASIC was the record civil penalties (AUD159.8 million) imposed by the courts. Furthermore, the significant increase in the number of criminal and civil penalty proceedings commenced in 2020 highlights ASIC’s dedication to the ‘why not litigate?’ approach, driving cultural change through public denunciation and punishment through the courts.
Upward trends in enforcement activity over past three years
Several upward trends in ASIC’s enforcement activity were identified over the three-year period from 2018 to 2020.
These trends reflect ASIC’s increased capacity (through improved resourcing) to undertake a greater number of investigations and secure more severe punishments for corporate misconduct.
In the markets division, there were 12 enforcement actions taken for market misconduct in the July-December 2020 period, relating to breaches of continuous disclosure, insider trading and other matters. Four of these actions resulted in a criminal determination by the court.
Decreasing priorities for ASIC
The Enforcement Update also shows some downward trends in certain enforcement activity that had been developing over the past few years.