The Australian Securities and Investments Commission (ASIC) has used its annual report tabled in Parliament, to repeat that it remains focused on addressing the delivery of poor financial advice, particularly with respect to large, vertically-integrated institutions.
ASIC chairman, Greg Medcraft pointed to the growth in superannuation savings as being the key driver for the structural change currently testing the regulatory environment. He noted that ASIC is responsible for regulating many of the financial products in which superannuation funds invest “and the gatekeepers that manage and advise on super”.
“The spread of market-based financing, driven by growth in super, an ageing population and an evolving funds management industry, impacts our work,” he said.
“We are meeting this challenge by stepping up our surveillances, responding where clients are getting poor-quality financial advice, and addressing incentives and poor risk management, particularly in large, vertically-integrated institutions.”
Medcraft said that ASIC had set up a special project to focus on the conduct of large financial advice firms, with some investigations ongoing.
“In 2014—15, 14 individuals were permanently banned from providing financial advice, and a further 23 individuals were banned or agreed to stay out of the industry for shorter periods of time,” he said. “We also conducted 321 funds management surveillances, including reviewing risk management practises.”
Elsewhere in the annual report, Medcraft reinforced the regulator’s desire to move to an industry funding model — something he claimed would create greater certainty and lead to better regulatory outcomes.
