ASIC has released updated guidance on how it will use its administrative powers to enforce financial services legislation, including its new markets supervisory powers.
ASIC has updated RG 98 – Licensing: administrative action against financial services providers – which outlines how it uses administrative remedies to enforce the compliance of Australian financial services (AFS) licensees and their representatives with the financial services legislation.
This updated version of RG 98 does not represent a substantive change to ASIC’s approach to using its administrative powers, but includes additional sections on the regulator’s new powers to supervise market participants.
As a result, for AFS licensees who are market participants, in addition to the general remedies ASIC may also ask the Markets Disciplinary Panel (MDP) to issue an infringement notice.
Compliance with an infringement notice may involve the payment of a penalty, undertaking remedial measures, accepting sanctions or entering into an enforceable undertaking.
ASIC’s policy on the role and operation of the MDP is set out in RG 216 Markets Disciplinary Panel.
While each matter is assessed on a case-by-case basis, the non-prescriptive factors and examples contained in RG 98 are intended to provide transparency as to how ASIC determines the most appropriate regulatory response in each case.
ASIC said it has a range of remedies available to it under the financial services legislation, including taking criminal, civil or administrative action.
The administrative remedies include suspending or cancelling an AFS licence, issuing an order banning a person from providing financial services, or accepting an enforceable undertaking as an alternative to other remedies where ASIC considers it appropriate to do so, and asking the MDP to issue an infringement notice.
RG 98 indicates the matters ASIC takes into account in determining whether administrative action is the most appropriate regulatory response.
