The government is set to introduce tougher new criminal penalties for misconduct in the financial sector with individuals to face ten years imprisonment as a result of misconduct.
The Coalition aims to introduce the legislation that would double some criminal penalties in the sector and increase, by more than ten-fold, civil penalties for corporations.
The strengthened sanctions will overhaul the penalties for white collar crime which in many cases haven’t changed in twenty years and will provide greater protection for consumers.
The legislation is based on recommendations from the ASIC enforcement review taskforce and will also expand the range of contraventions subject to civil penalties.
The new rule for individuals will increase the maximum criminal penalties from 5 years imprisonment to 10 years and the fine from $42,000 to the greater of $945,000 or three times the benefit gained/loss avoided.
Corporations will see the fine shift from $210,000 to the greater $9.45 million or three times the benefit gained/loss avoided or 10 per cent of annual turnover.
The maximum civil penalties for individuals will change from $200,000 to the greater of $1.05 million or three times the benefit gained/loss avoided.
Corporations meanwhile will see a ten-fold increase from $1 million as a maximum civil penalty to $10.5 million or three times the benefit gained/loss avoided or 10 per cent of annual turnover, capped at $210 million.
Additionally, the courts will have the power to seek additional remedies to strong wrongdoers of profits illegally obtained or losses avoided because of misconduct.
The bill is the latest from the government, after they increased ASICs funding to bolster enforcement capabilities and established the new external dispute resolution body AFCA.
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