The Australian Securities and Investments Commission (ASIC) said the inquiry will be conducted by an expert panel and follows persistent concerns shared by both ASIC and the Reserve Bank about ASX’s ability to maintain secure and resilient systems.
ASIC chair Joe Longo described the inquiry as a necessary step following “repeated and serious failures” at ASX, most notably the high-profile CHESS batch settlement failure on 20 December 2024. That specific investigation has now been folded into the broader review.
“ASX operates Australia’s critical markets infrastructure,” Longo said. “Investors and market participants deserve to have absolute confidence that ASX is operating soundly, securely and effectively.”
He added that ASX’s unique position in the market – serving as the backbone for buying and settling equities and futures – meant the integrity of its systems was paramount.
While ASIC did not disclose the names of the panel members or a timeline for the final report, the regulator confirmed that recommendations would be made public and could lead to further regulatory or enforcement actions.
Longo noted the cooperation of ASX’s board, CEO, and chief risk officer, who have all pledged to fully support the inquiry.
“The inquiry provides an opportunity for ASX to bolster market trust,” he said.
ASIC emphasised that while the inquiry is underway, ASX must continue to focus on the stability and efficiency of its platforms, including ongoing work on the long-delayed CHESS replacement project, which is targeting a mid-2026 launch for its first phase.
The ASX acknowledged the inquiry in a statement, with ASX chairman David Clarke quoted as saying: “We acknowledge the seriousness of this action, and ASIC’s inquiry will have our full cooperation.
“We have been working hard on a transformation strategy with several of the initiatives designed to strengthen culture and capabilities, operational risk management, business resilience and technology resilience, but we acknowledge there have been incidents that have damaged trust in ASX.”
Similarly, ASX managing director and CEO Helen Lofthouse said the ASX is committed to supporting the wide-ranging inquiry, which she said will deliver an independent and transparent view of both the progress made and the work still to be done to ensure stakeholder trust and confidence in the exchange.
“Each person at ASX understands the key role we play in the financial system and we will provide all the support required to ensure this inquiry is effective.”
