CommInsure was concerned about ASIC ‘pay-off’
CommInsure was concerned that if it entered into an agreement with the Australian Securities and Investments Commission (ASIC) to pay a so-called “community benefit payment” it might be perceived as “paying off” the regulator.
The Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry that there was concern that making such a payment in the absence of a regulatory “hook” might give rise to the perception of the of pay-off.
Giving testimony to the Royal Commission, ASIC chairman, James Shipton said that he was concerned that such a situation might have arisen.
However, he denied that ASIC was in the business of entering into cosy relationships with the financial services companies it regulated and said that the regulator was simply seeking to use its resources efficiently.
Shipton then foreshadowed a change in approach to community benefit payments and enforceable undertakings saying he had asked his ASIC team “to look at the utility of community payments and enforceable undertakings” stating “we need to be more willing and agile to pursue court-based outcomes”.
He told counsel assisting the Royal Commission, Rowena Orr QC that that meant “that it is under review right now and I have asked for more discipline, structure and rigour around community benefit payments”.
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