D’Aloisio became the chairman of the corporate watchdog on 13 May 2007, replacing Jeff Lucy.
The former managing director and chief at the then Australian Stock Exchange, D’Aloisio’s new post came at a time when Australia’s financial services industry was asking a lot of the regulator.
The fallout from the collapse of the Westpoint group of companies was at its height, with around 4000 investors out of pocket $400 million in the 2006 collapse.
In response to Westpoint, in September 2007, D’Aloisio rallied his troops and launched an investigation in the form of a strategic review into the risks and pitfalls facing retail investors.
The strategic review, led by the then ASIC deputy chair Jeremy Cooper, was concluded the following year.
At the time, D’Aloisio said: “By the end of the strategic review process, ASIC will have a road map to ensure it remains a modern, externally-focused, flexible and accountable regulator, with the skills to face and meet the challenges in the next three to five years.”
The review looked at disclosure documents for financial products, the provision of advice and compensation arrangements.
A month later in November 2007, D’Aloisio pushed ahead with legal proceedings against companies and financial planning firms involved in the fall of Westpoint.
Midway through 2008, he was given a helping hand from the federal government, with the sign off on two extra commissioners.
The decision to increase ASIC’s commissioners from three to five followed a request from the regulator based on issues identified following its strategic review.
It had been 17 years since the number of ASIC commissioners was altered.
The extra commissioners came just days after the Federal Court found ASIC did not have the power to take over existing proceedings brought against Westpoint directors by the liquidators of Westpoint companies.
As ASIC’s actions against these individuals and firms wound down, ASIC and D’Aloisio’s duties were again under fire in late 2008 with the fall of advisory group Storm Financial.
The chairman was hauled before a parliamentary inquiry into Australia’s financial services products. While he patiently faced pointed questions from his professional peers, the inquiry found it would be best for ASIC to be granted greater powers.
The reform was in line with the move towards centralised or independent regulation in other leading jurisdictions, Financial Services, Superannuation and Corporate Law Minister Chris Bowen said in August last year. “Having one whole-of-market supervisor will consolidate the current individual supervisory responsibilities into one entity, streamlining supervision and enforcement, and providing complete supervision of trading on the market,” Bowen said.
“Moving to whole-of-market supervision is also the first step in the process towards considering competition between market operators.”
At the time, D’Aloisio said the regulator had assured the government it was able to take on the new responsibilities.
“ASIC is now closer to the market, more accessible, flexible and able to take emerging trends into account more quickly,” he said.
“We will be working closely with ASX (Australian Securities Exchange) to ensure a smooth transition of market surveillance and participant supervision responsibilities to ASIC.”
It has no doubt been a difficult move for D’Aloisio, whose four-year term as ASIC chair ends next May. However, for a man with a resume filled with such titles as Mallesons Stephen Jaques chief executive partner with principal areas of practice being mergers and acquisitions, taxation, restrictive trade practices, and international trade and investment, the degree of difficulty would surely seem quite manageable.
