Speaking to InvestorDaily, NSW Nationals Senator John Williams said ASIC’s job is “simply to enforce the corporate law” and that any attempts to seek settlements are “100 per cent wrong”.
Mr Williams posed a series of questions to ASIC chairman Greg Medcraft as part of the regulator’s appearance before the Senate Economics Committee yesterday morning.
The senator pointed out Mr Medcraft had previously told the committee that he saw it as his “duty” to pursue a settlement in relation to the collapse of Storm Financial.
“I said to you last time, 'I’ll go to my grave believing it’s your duty to enforce the corporate law [and not] pursue settlements',” said Mr Williams.
He asked Mr Medcraft if he was still willing “to spend millions of dollars in the courtroom to pursue a settlement”.
“Isn’t it your duty as the corporate watchdog to see that the corporate law is upheld and not pursue settlements, or do you still stand by what you said before?” he asked.
In response, Mr Medcraft said the Storm Financial case was initiated before he became the chairman of ASIC in May 2011.
“We started this case, we are pursuing this case, and obviously we will complete this case. We’ve recovered over $350 million so far,” said Mr Medcraft.
“We have the power to pursue compensatory action under the law – and certainly we’ve done that with Storm [Financial],” he said.
But he acknowledged that the class action industry is “quite effective” in terms of pursuing compensation for clients.
“Maybe if we had a similar situation in the future we may decide to allow the class action industry to pursue it,” he said.
Mr Williams said ASIC’s role is that of the ‘corporate watchdog’, and the regulator should let the courts decide whether or not the corporate law has been broken.
“If [the law has been broken], then people can seek redress through the appropriate avenues – but it is not ASIC’s role and I’ll be taking this up with [assistant treasurer] Arthur Sinodinos,” he told InvestorDaily.
