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Ethics Centre among beneficiaries of left-over remediation payments

ASIC/

16 February 2021
| By Mike |
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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 

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