The Australian Securities and Investments Commission (ASIC) should not be allowed to retain the proceeds of its successful regulatory prosecutions, according to the Association of Superannuation Funds of Australia (ASFA).
In a submission to the Treasury addressing the proposed industry funding model for ASIC, ASFA has pointed to the regulator's heavy reliance on enforcement activity and urged against ASIC being allowed to develop a "prosecutorial culture".
Discussing the proposed industry funding model, ASFA said it understood the proceeds of ASIC's enforcement activities "would be paid into consolidated revenue (and thus not provide ASIC with a direct revenue source)".
"ASFA considers that this is an important safeguard to ensure that the regulatory model does not provide incentives for an excessively prosecutorial culture to develop," the submission said.
However it said that ASIC needed to be more transparent about the level of regulatory effort being applied to industry sectors and sub-sectors.
"More complete sub‐sector data on the allocation of regulatory effort and resources would provide the regulated population with greater confidence that the allocation of costs among ASIC's regulated population is appropriate," the submission said.