I am pleased to appear before the Committee once more. I am joined today by Deputy Chair Sarah Court, and fellow Commissioners Kate O’Rourke, Alan Kirkland and Simone Constant, as well as the CEO, Greg Yanco, General Counsel Chris Savundra, and CFO, Peter Dunlop.
Since our last appearance before this Committee we have been making strong progress on the transformation of the agency, and achieving significant outcomes across our remit.
Key outcomes
In recent months, we have delivered some important regulatory firsts, including:
- winning the first civil penalty action for greenwashing, resulting in a landmark $11.3 million penalty for Mercer Superannuation (Australia);
- issuing the first infringement notice to a market operator, with the ASX paying a penalty of $1,050,000 following ASIC’s investigation into pre-trade transparency.
- In July, we laid charges in an alleged ‘pump and dump’ conspiracy that used the messaging platform Telegram, with the defendants facing a maximum penalty of 15 years imprisonment and a fine of over $1 million for market manipulation. During our investigation ASIC took the unprecedented step of posting messages in the Telegram chat room to warn traders they may be breaking the law by seeking to organise stock price manipulation.
Better Banking
I note this Committee’s role in reviewing Australia’s four major banks and I’m aware that in their last appearance, you took the opportunity to ask about ASIC’s Better Banking for Indigenous Consumers report.
This was a first of its kind review by ASIC, which will result in $28 million being refunded to vulnerable consumers and, as a result of ASIC’s intervention, the banks have now migrated more than 200,000 customers into low-fee accounts.
While ASIC’s review was focussed on improving financial outcomes for First Nations consumers by addressing avoidable bank fees, the findings have resulted in broader outcomes for people on low incomes nationwide.
It’s an example of the positive impact of ASIC’s work and one I am very proud of.
QBE action
This week we have commenced court proceedings alleging QBE Insurance Limited misled its customers about the value of discounts offered on certain general insurance products.
ASIC contends QBE’s pricing model potentially eroded the discounts received by over half a million customers, in some cases to nil.
The failure by insurers to deliver on pricing promises is a key priority for ASIC and we will continue to take action to hold insurers to account.
Floods inquiry
While on the topic of insurers, I’d like to acknowledge the Committee’s final report from its inquiry into insurers’ response to the major floods in 2022. This was a thorough inquiry and by conducting hearings in flood impacted regions of the country, the Committee heard directly from many Australians whose lives have been upended by the floods, and were let down by their insurers.
ASIC will take time to carefully consider the inquiry’s recommendations, including the 22 that relate directly to us. We will do this in the context of the work we are already undertaking in relation to general insurance.
We are actively considering matters that would enable ASIC to use our claims handling powers for enforcement action.
As the Committee is well aware, ASIC has clear expectations of the insurance industry and insurers have a lot of work to do to rebuild the trust and confidence of consumers. We are continuing to closely watch this sector.
ASIC’s transformation journey
The Annual Report we tabled this week is an opportunity to reflect on ASIC’s journey of growth and transformation which began three years ago and has included the most significant organisational redesign of the agency in 15 years.
Pleasingly, ASIC’s transformation is delivering results including:
- enhanced collaboration across the agency meaning quicker times for matters to be progressed for enforcement and compliance action;
- Improved data analytics and surveillance capabilities, underpinned by our long-term approach to becoming a leading, digitally enabled and data-informed regulator; and
- Strengthened engagement with external stakeholders to listen to their views and set clear expectations of those we regulate.
A transformation of this scale has seen some short-term impacts. But as a result of the efforts of our people over the past three years, and Commission and Executive renewal, we are well-placed for the next phase. This will of course include a continuing focus on strengthening ASIC’s culture and investing in data, systems and technology.
Our Annual Report tabled this week highlights our strong enforcement and consumer protection outcomes - we’d be happy to answer your questions on these in our time here today.
Looking to the future
While there has been considerable progress made, there is more work to be done to continue ASIC’s transformation. This will of course include a continuing focus on strengthening ASIC’s culture and investing in data, systems and technology.
Finally, I’d like to take this opportunity to place on the public record my deep gratitude for the role each and every person at ASIC plays in upholding the integrity of Australia’s financial system. They are deeply committed to helping all Australians through their work.
We look forward to answering the Committee’s questions.
