Senate Committee recommends royal commission
The Senate Committee reviewing the performance of the Australian Securities and Investments Commission (ASIC) has recommended a royal commission be instigated into the events which led to an enforceable undertaking entered into by Commonwealth Financial Planning.
The committee has also recommended that responsibility for compensation arrangements be taken away from the Commonwealth Bank.
At the same time ASIC has been directly criticised by the chairman of the Senate Committee reviewing its performance.
Senator Mark Bishop, handing down the report of the Senate Economics References Committee, described ASIC as having been "lulled into complacency" and as having paid too little attention to whistle-blowers within Commonwealth Financial Planning.
He said the committee is of the view that the CBA played down the seriousness of the problems within CommFP in an effort to limit compensation payments.
"This highlights how trusting the regulator is of big business," Senator Bishop.
It is only since May this year that ASIC has begun to understand how the compensation schemes work.
"It is essential that all rogue advisers be identified and all breaches be pursued and that all affected clients receive just compensation and the current compensation arrangements are inadequate," he said.
"To my mind responsibility for the compensation arrangements should be taken away from the bank," Senator Bishop said.
Money Management’s coverage of the Senate Committee report into the performance of ASIC:
Bushby issues dissenting report
CBA refutes senator's deflection claims
ASIC should face regular reviews
Senate report calls for adviser banning powers and increased penalties
Report calls for higher education standards and enshrinement
Expect ASIC to be more rigorous
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