Budget 2022: Govt commits to MIS review
The Government has committed to a review of managed investment schemes (MIS).
In last night’s Budget, some $2.7 million was allocated in 2022/23 for the Treasury to support reviews of the Reserve Bank of Australia (RBA) and the regulatory framework for MIS.
Stephen Jones, assistant Treasurer and minister for financial services, said he was particularly focused on property and property-like structures like Sterling Income Fund, which was subject to an Senate inquiry last year.
In discussion with Blake Briggs, Financial Services Council (FSC) chief executive, he said: “I’m seeing a lot of my colleagues saying every year we are seeing significant investors losses and collapses. And inevitably, the victims come to the Government or go to ASIC [the Australian Securities and Investments Commission] and ask what we were doing, why wasn’t the regulator on top of this?
“We want to have a look at the managed investment scheme sector and I’m particularly interested in the area of property and property-like schemes and the interface between state and federal law because there’s a lot of crossover and grey areas and it’s time we had a look at this.
“[This includes] questions about wholesale and retail thresholds, the types of products being sold in retail markets and whether the regulatory and oversight settings are right.”
He described the review as being more than of a “health check” conducted by Treasury rather than another Royal Commission.
“There is a collective interest in getting this right because the compensation scheme of last resort puts in place a collective liability if things go very, very wrong, so we have got to ensure that it does actually operate as a last resort compensation scheme.
“It has to ensure all the regulatory settings are correct before collapses occur, before malfeasance occurs, before mis-selling occurs and before catastrophic consumer loss.”
AUTHOR
Laura Dew
Recommended for you
ASIC has cancelled the AFSL of an advice firm associated with Shield and First Guardian collapses, and permanently banned its responsible manager.
In the run-up to heavy losses expected at the end of the financial year, June has already reported consecutive weeks of adviser losses.
ASIC has banned a former NSW adviser from providing advice for 10 years for investing at least $14.8 million into a cryptocurrency-based scam.
ASIC has sent warning notices to social media finfluencers who it suspects are providing unlicensed financial advice to Australians as part of a global crackdown by international regulators.
