ASIC warns businesses of its new focus for 2023

Late last year, ASIC warned businesses it would focussing on greenwashing of claims but has now added a number of other practices it will be monitoring as part of a continuing focus on protecting consumers from financial harm.

The warning coincides with the release of its latest enforcement and regulatory report, highlighting actions taken during the last three months of 2022 and outlining the full list of enforcement priorities for the year ahead (REP 757).

ASIC deputy chair Sarah Court said the actions taken during the final quarter of 2022 reflected ASIC’s continuing strategic and enforcement priorities.

“In the final three months of last year we commenced a number of significant enforcement and regulatory actions to address misconduct, market integrity threats and consumer harms in sectors including financial services, retail and crypto-assets,” Ms Court said.

“This includes corporate governance and directors’ duties, product design and distribution, and misleading statements involving sustainable finance practices.”

In the last half of 2022, ASIC laid 173 criminal charges and $76.3 million in civil penalties were imposed by the courts.

Additionally, 62 investigations were started and there were another 103 investigations ongoing. For the 2022 calendar year, there were 312 criminal charges laid and $222.1 million in civil penalties imposed by the courts.

ASIC took action against former directors of Star Entertainment Group Limited for alleged breaches of their director and officer duties involving money laundering risks.

It also issued 22 design and distribution obligations (DDO) stop orders, 14 of which were issued in the last quarter, to prevent consumers and investors from being targeted by products inappropriate to their objectives, financial situation, and needs.

And in October last year, it issued its first greenwashing infringement notices to three entities in the reporting period for misleading sustainability-related statements.

Regulatory developments timetable

This year, ASIC said it will have a strong focus on enforcement activity targeting sustainable finance practices and disclosure of climate risks, financial scams, cyber and operational resilience, and investor harms involving crypto assets.

For the first time, ASIC has published a regulatory developments timetable to be more transparent. The timetable will help industry to better anticipate when ASIC will issue draft or final guidance or the making of a legislative instrument.