ASIC introduces new panel for banning brokers

by Miklos Bolza11 Apr 2017
The Australian Securities & Investments Commission (ASIC) has proposed a new Financial Services Panel which would play a role in banning participants in the financial services and credit industries.

The panel would be initially responsible for determining whether ASIC should make a banning order for misconduct within these industries in cases “where it is appropriate for peer review because of its significance, complexity or novelty,” the regulator said in a consultation paper released today (11 April).

“While it would be possible to refer all banning matters to the Panel, this would increase the cost of the process and the demands placed on Panel members. We consider this would only be justified where the potential benefits of having a Panel decision … outweigh the additional costs of doing so.”

ASIC may also consider expanding the power of this panel to other areas in future, including:
  • Issuing infringement notices
  • Refusing an AFS or credit licence application
  • Imposing conditions on an AFS or credit licence
  • Cancelling or suspending an AFS or credit licence
The panel would initially be composed of three sitting members: two industry or non-industry participants and at least one ASIC staff member. Outcomes would be achieved through a simple majority vote.

“We propose that an ASIC staff member would sit on the Panel, as this will ensure there is a Panel member who is specialised and trained in these types of decisions, and is familiar with the law and ASIC’s policy and guidance. An ASIC staff member on the panel would also mitigate the potential disadvantages of a peer based model.”

A secretariat comprised of ASIC staff members would provide further assistance to the panel.

ASIC has asked for submissions on the new consultation paper by 23 May 2017.