ASIC wants BEAR-like powers across the board
The Australian Securities and Investments Commission (ASIC) has signalled that the insurance industry will be the next sector to be subject to Bank Executive Accountability Regime (BEAR) with other sectors, including planning, more likely to be subject to extended ASIC enforcement powers.
Giving evidence before the Senate Economics Legislation Committee inquiry into the BEAR legislation, ASIC senior executive leader, Greg Kirk agreed with Queensland Labor Senator, Chris Ketter that ASIC believed the BEAR should be extended to other parts of the financial service sector.
Kirk said that extending the BEAR to other sectors was certainly true of greater accountability for management failure and added that, “given that the BEAR is focused on prudential issues, an obvious next step is insurers, and generally we think that is likely to be a good step in the future”.
However, the ASIC executive also noted the degree to which the BEAR legislation was tied to prudential issues and the manner in which this precluded it being extended beyond prudentially regulated institutions such as banks and insurers.
In doing so, he suggested that ASIC might in future be able to act on executive conduct via increased powers.
“From a conduct perspective – and this is the thing that's being explored through the review of ASIC's enforcement powers – if and when ASIC is able to ban people from management, that's not a barrier,” Kirk said.
He said the conduct obligations and conduct regulation extended beyond prudentially regulated institutions and covered the whole of financial services.
“… we think long-term, from a conduct perspective, there should be increased accountability, not just for the big institutions but across the board,” Kirk said.
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