Westpoint investors call for Royal Commission

Nick Sherry

The president of the Westpoint Investors Group has called on Superannuation Minister Nick Sherry to hold an open inquiry into the performance of the Australian Securities and Investments Commission (ASIC).

MacAulay and the Westpoint Investors Group are aggrieved by the “incomprehensible” suspended sentence and $50,000 fine recently handed down to a person convicted for their involvement in the Westpoint collapse. The group has questioned the speed of the responses from ASIC and the Australian Prudential Regulatory Authority (APRA) to the issue, as well as the depth of the examination into the matter, among other concerns.

MacAulay called Westpoint “the tip of the iceberg” and said the “continuing failure of the regulators goes far beyond” this one matter. MacAulay also said that while the sub-prime crisis had impacted markets across the world, a “great number” of the problems in the Australian marketplace have occurred due to ASIC’s “systemic failure” and poor performance.

MacAulay has called on Sherry to announce the establishment of “the promised open inquiry into past ASIC performance”.

“I remind you of your promise, in a media release — and in a communication to me — [that] Labor would hold an open inquiry into past ASIC performance if they came to office. Labor has come to office and we are yet to hear the date of that inquiry,” he said.

“Given ASIC’s lack of performance in the current year, it cannot be less than a Royal Commission if anything positive is to flow from its findings.”

MacAulay said that such an inquiry “would not damage financial confidence — ASIC, APRA, and the [Australian Securities Exchange] have ensured it cannot fall to a lower level”.

“Their combined, continuing lack of effective action is a running sore on investor confidence,” he said.

“Suppressing the failure of our regulators, and lauding them as world leaders, does nothing to fix the problem. Despite management changes with ASIC, nothing in the marketplace has changed.”

In regards to the suspended sentence recently handed down, MacAulay on behalf of the Westpoint Investors Group said: “Whether the fault lies with ASIC or the [Director of Public Prosecutions] is of little consequence. Even though the jury found Burnard guilty, it is yet another botched prosecution involving ASIC.”