ASIC to offer further detail on EU compliance
The Australian Securities and Investments Commission (ASIC) has released updated guidelines as to how it uses Enforceable Undertakings (EU) stating that from March it would provide further details as to the level of compliance attained by groups issued with an EU.
In changes made to Regulatory Guide 100 Enforceable undertakings (RG 100) ASIC stated that "for enforceable undertakings accepted by us on or after 9 March 2015 we will report publicly on whether undertakings given by a promisor (EU recipient) in an enforceable undertaking have been complied with".
"This may include interim reporting about compliance as well as reporting on final outcomes under an enforceable undertaking."
The updated regulatory guide follows recent media questioning as to how far Macquarie Equities Limited (MEL) and Macquarie Private Wealth (MPW) had complied with its EU with ASIC refusing to provide specific details as to what area those businesses had yet to comply with.
Last week ASIC announced that while MEL and MPW had completed its EU that ASIC would continue to monitor it for a further 12 months to ensure changes could be verified under operational conditions.
The regulator stated there was significant public interest in the actions taken by ASIC and it would continue to make EU's public to maintain market integrity, consumer confidence and to deter other poor behaviour.
However it would not issue full reports of independent experts appointed either by ASIC or a group involved in an EU nor would it accept EUs in which ASIC's ability to provide details on a firms's compliance with an EU or the details of an independent expert report was restricted by the group involved.
ASIC stated in the regulatory guide that all EUs accepted from 9 March 2015 will contain a standard term of acknowledgement by the recipient of an EU that ASIC will publicly report on compliance with undertakings given by the EU recipient.
ASIC restated that EUs would not be used for trivial matters but would continue to be considered in more serious cases "where this remedy can achieve a more effective regulatory outcome than civil or other administrative action".
ASIC has so far issued one EU in 2015, 24 in 2014 and 27 in 2013 with groups such as Commonwealth Securities, Aurora Funds Management, Royal Bank of Scotland, BNP Paribas (2014) and UBS, National Australia Bank, WealthSure, Macquarie Equities (2013) all receiving EUs in recent years for various reasons. The EU issued to the Commonwealth Bank for actions within Commonwealth Financial Planning was issued in 2012.
AUTHOR
Jason Spits
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