In its final report, released in early 2019, the commissioner recommended that ASIC overhaul its approach to enforcement, with a focus on court action.
ASIC was given wide-ranging enforcement powers that enabled it to intervene early, rather than only taking action against companies once financial losses had been disclosed.
These include product intervention powers that can halt the sale of financial and credit products that have resulted in, or are likely to result in, significant consumer detriment.
It can also ban a product or feature of a product, imposing restrictions on sales and amending the information the promoter puts out on the product.
ASIC and APRA will come under more scrutiny with the government set to introduce legislation to establish the Financial Regulator Assessment Authority, which will regularly assess the effectiveness and capability of the regulators – a recommendation of the royal commission.
Longo’s previous roles include a stint as ASIC’s national director of enforcement from 1996 to 2000. He also has significant experience in the financial services industry and corporate law.
Sarah Court, a commissioner at the Australian Competition and Consumer Commission (ACCC), has been appointed as ASIC’s deputy chairperson, replacing Daniel Crennan. She was responsible at the ACCC for enforcement matters.
Karen Chester remains the other deputy chairperson, a position she had held since joining the regulator from the Productivity Commission in early 2019.
Consumers want a tough cop on the beat and will likely look dimly on any pressure from the government on ASIC to be friendlier to those it regulates at the cost of its new-found bite.
Seeking out and winning large financial penalties from those doing the wrong thing sends a clear message that any number of enforceable undertakings could never achieve.