The Ethics Centre has been a beneficiary of a practice adopted by the Australian Securities and Investments Commission (ASIC) which has seen surplus/residual remediation funding directed towards consumer and charity groups.
ASIC has admitted to a Parliamentary Committee that in circumstances where remediation funds have not been capable of being returned directly to affected consumers they are directed at ASIC’s discretion to “appropriate recipients”.
Answering a question on notice, the regulator said that from time to time it monitored consumer remediation programs conducted by firms.
“Sometimes these programs include a residual payment where funds could not be returned directly to affected consumers, so instead a residual payment was passed by the firm on to an appropriate recipient to be used to provide services, information or education to consumers of a type that may be affected by the misconduct,” it said.
“In these situations the underlying principle is that a firm should not benefit from the profits of their breach. In both these circumstances, the firm directly pays the relevant recipient.
“Examples of recipients who have received payments under either a CEU and/or residual remediation payment include:
* Ecstra Foundation
* Financial Literacy Australia (wound-up)
* The Financial Counselling Foundation
* The Ethics Centre
* Smith Family
* Brotherhood of St Lawrence
* Salvation Army
* Cerebral Palsy Alliance
* Dementia Australia