Protein shake for ASIC
Recommendations of the 2016 ASIC Enforcement Review Taskforce that the regulator's powers be strengthened have finally been put into legislation, with the passage of a bill last week that harmonises ASIC's search warrant powers and enhances the regulator's ability to access certain telecommunications information.It also strengthens ASIC's licensing powers and extends its banning powers.The Financial Sector Reform (Hayne Royal Commission Response - Stronger Regulators (2019 Measures)) Act includes the following changes:Search warrants. ASIC currently has a range of search warrant powers contained in different pieces of legislation. The existing powers "are not as practical or effective as they should be". Now they are harmonised in the ASIC Act.The new law also incorporates many of the ancillary powers in the Crimes Act to beef up ASIC's powers. For example, ASIC now has power to take photographs and make video recordings, use electronic equipment to access data and move devices to another place for processing.Telecommunications intercept. ASIC was not listed as an intercept agency under the Telecommunications Interception and Access Act, which meant that it could not apply for warrants to intercept telecommunications and could not share information with intercept agencies. The new law allows interception agencies to provide ASIC with information about an interception warrant or lawfully intercepted information, where the information relates to an offence that ASIC can investigate.Licensing and false or misleading documents. Under the old law an applicant for an Australian financial services licence had to be "of good fame and character", while an applicant for an Australia credit licence had to be "fit and proper". This anomaly created some practical problems.Under the new law applicants for both licences must be fit and proper. The fit and proper persons test has been widened to cover all officers, partners and trustees of an applicant. The test must be satisfied on an ongoing basis.ASIC will greater power to demand information about an applicant, as well as the power to refuse to grant a licence when a material particular in an application is false or misleading.Banning orders. The new law expands the grounds on which ASIC can make a banning order, allowing it to take a broader range of activities into account when determining non-compliance with financial services laws.The existing grounds for banning a licensee include a finding that a person is "not of good fame and character", is not adequately trained, is not competent to provide a financial service or is insolvent.New grounds include: the person has been linked to a refusal or failure to give effect to an AFCA determination on more than one occasion; on more than one occasion, the person has been an officer of a corporation that was unable to pay its debts.