ASIC has been busy over the past six months cracking down on those in the financial services industry, its half-yearly enforcement report shows.
This morning the regulatory body released its fifth six-monthly enforcement report, showing it cracked down 340 times on criminal, civil and administrative misdemeanours between 1 July 2013 and 31 December 2013.
There were 112 outcomes achieved in the market integrity, corporate governance and financial services areas, and 228 in the small business area.
A notable prosecution which ASIC helped with was that of Clestus Weerappah, a former director of Dollarforce Financial Services, who was jailed for four years over his role in the collapse of the property development group.
“The sentence sends a clear message to corporate Australia that ASIC, the community and the courts will not tolerate criminal behaviour,” ASIC said.
Other outcomes that ASIC contributed to include the Federal Court finding five former directors of Australian Property Custodian Holdings liable for breaching their duties, and the Full Court of the Federal Court of Australia upholding ASIC’s appeal against the court-approved $82.5 million settlement between former Storm Financial investors and Macquarie Bank.
ASIC’s work will also see more than $15 million refunded to consumers, it said.
The regulator is currently cracking down on misleading advertising of products and services, market misconduct, including insider trading, and the responsibility of gatekeepers.
“Future areas of focus include loan fraud, false accounting, and takeovers and shareholder disclosure, as well as the ongoing focus on advertising,” commissioner Greg Tanzer said.
“ASIC’s crackdown on brokers submitting fraudulent loan applications and similar behaviour has seen several individuals criminally charged or banned. We currently have more than 20 investigations underway involving falsification of loan documents and loan applications.”
ASIC also secured enforceable undertakings with a number of high profile companies including NAB, UBS, Wealthsure, BT, and Commsec.
“Negotiated outcomes, such as EUs, can offer a faster, more flexible and effective regulatory outcome than could otherwise be achieved through administrative or civil action,” Tanzer said.
“Since 1 July 2011, ASIC has entered into 63 EUs with entities and individuals. Many of these enforceable undertakings have required entities to pay compensation to consumers, improve internal compliance arrangements, appoint an independent expert to oversee elements of the entity’s business and report back to ASIC on performance.”
The latest was with
BNP Paribas, which has promised ASIC it will clear up its act after it suspected its traders were trying to influence Australia's benchmark interbank lending rate.
In the financial services sector, there were 12 successful criminal prosecutions, five civil, 34 administrative remedies (such as banning or disqualification), 23 enforceable undertakings, and four warnings issued.