The Australian Securities and Investments Commission (ASIC) has ramped up its focus on misconduct within the banking and superannuation sectors, as outlined in its Enforcement and Regulatory Update for the first half of 2024. The report details ASIC’s significant progress in enforcement actions, regulatory surveillance, and ongoing investigations, emphasising its commitment to protecting consumers and ensuring compliance.
Key enforcement outcomes
Between January and June 2024, ASIC demonstrated a strong enforcement record, achieving success in 95% of its civil and criminal prosecutions. The regulator secured $32.2 million in civil penalties and obtained nine criminal convictions. During this period, ASIC initiated 63 new investigations, launched 12 new civil proceedings, and completed 550 regulatory surveillances.
These figures underscore ASIC’s continued vigilance and growing capacity to hold financial institutions accountable for misconduct, particularly in relation to consumer protection laws.
Focus on lenders and financial hardship
One of the major highlights of the report was ASIC’s review of how 10 large home lenders addressed financial hardship among their customers. The regulator examined whether these lenders were doing enough to support individuals experiencing financial difficulties, particularly in the face of economic challenges.
Sarah Court, ASIC’s Deputy Chair, emphasised the real-world impact of these reviews: “We have seen first-hand the impact on lives and livelihoods when lenders fail to appropriately support customers experiencing financial hardship. In the wake of our review, we put the lending industry on notice.”
She further warned that ASIC is actively investigating suspected breaches of hardship obligations and stands ready to take enforcement action where necessary to ensure compliance.
Anti-scam measures in banking
ASIC has also directed its attention toward improving scam prevention and detection across the banking sector. Last month, ASIC completed a review of 15 banks, excluding the four major banks, focusing on their scam prevention activities. This effort builds on ASIC’s earlier report on scam-related activities conducted by the major Australian banks (Report 761), released in April 2023.
The regulator’s ongoing focus on anti-scam practices aims to strengthen the broader financial services landscape against the rising threat of financial fraud and scams, which pose significant risks to consumers.
Superannuation sector: Retirement outcomes and death benefits
ASIC’s review of the superannuation sector revealed a continued focus on whether trustees are doing enough to secure better retirement outcomes for their members. In the coming months, the regulator is expected to announce the results of its surveillance on how superannuation funds are handling death benefits claims, an area that has drawn considerable scrutiny.
ASIC is also taking proactive measures to tackle greenwashing—the practice of misleading consumers about the environmental credentials of products or investments. As environmental concerns become increasingly important to consumers, ASIC’s intervention in this area is critical to maintaining transparency and accountability in financial markets.
Looking forward
As ASIC continues to target misconduct, its upcoming initiatives and enforcement actions will be closely watched by both industry participants and consumers. The regulator has made it clear that ensuring compliance and protecting the rights of consumers, particularly those facing financial hardships, remains a top priority.
ASIC’s efforts to address scam prevention, superannuation fund management, and greenwashing highlight its broad regulatory scope, ensuring that financial institutions uphold high standards of integrity and accountability.
In the months ahead, further results of ASIC’s investigations and surveillance activities will shed more light on how effectively these sectors are serving the public interest.
