Finder (ASIC): ASIC has commenced civil penalty proceedings in the Federal Court against Finder Wallet Pty Ltd, for allegedly providing unlicensed financial services, breaching product disclosure
Crypto custody (Treasury):Treasury has announced that there will be custody rules introduced for digital assets in 2023. The exclusive in this AFR article (linkhere), provides that Treasury will open consultations to safeguard crypto custody arrangements and regulate…
FTX (Regulation): The digital assets world has been rocked by the liquidity run on FTX the week, the world’s second largest exchange, and the near buyout by Binance, the world’s largest exchange. While there are various reasons being put forward for the issues facing FTX, in a febrile…
Financial Accountability Regime (Parliament): As expected, the Senate Committee examining the reintroduced FAR bill has give it the tick of approval, stating, “The committee is of the view that accountability measures, such as the existence of banning powers and deferred remuneration arrangements,…
Crypto Report (Parliament): I have now spent a bit of time on the new crypto bill. By way of reminder, on 19 September 2022, Senator Andrew Bragg released a draft private members bill, entitled the Digital Assets (Market Regulation) Bill 2022 (the Bill). Under the Bill, a licence is required to carry out the following activities in Australia…
Remediation Plan (ASIC): ASIC has released its new remediation guidance, RG 277. Mandatory reading for anyone who deals with breach reporting, and fixing the problems that arise up, RG 277: clarifies nine principles for conducting a remediation, which will help licensees comply with their obligations and conduct…
Licensing update (ASIC): I attended an ASIC licensing update earlier in the week, and it was fascinating! My notes are in my weekly newsletter, which you can access here (reach out to me if you wish to be on the emailing list). The resourcing, consistency and strategy of the division was discussed, together with other matters…
FAR (Parliament): The FAR bill is in Parliament, and is likely to pass in the Spring sitting which ends in December 2022. See here for details. The Government is now seeking stakeholder views on the Minister Rules. The Minister Rules prescribe…
FAR (Parliament): IT. IS. FINALLY. HERE. AND. I. AM. EXCITED! This week, the Federal Government introduced the Financial Accountability Regime Bill 2022 (Cth). The bill reintroduces the Financial Accountability Regime Bill 2021 (Cth), which was introduced by the previous Government but lapsed with the calling…
FAR (ASIC): Information from an ASIC session with the Chair and Commissioners this week in which I took the following notes. FAR will be passed in Spring sitting. It will come into effect for ADIs in March 2023. It will come into effect for Super / Insurers in March 2024. Finally, there is lots of work going on in the background…
Token Mapping (Treasury): The Government has announced that Treasury will prioritise token mapping work in 2022, which will help identify how crypto assets and related services should be regulated. The aim will be to identify notable gaps in the regulatory framework, and progress work on a licensing framework,…
AG Priorities (Government): The meeting of the Federal and State Attorney-Generals has occurred with them setting out their common reform priorities. Not much from a financial services regulatory perspective. They continue to focus on defamation, access to digital records upon death/incapacitation and national register for enduring POAs…
Corporate Plan (APRA): APRA’s new Corporate Plan for 2022/2023 is based around the twin themes of protecting the community today, as well as ensuring the Australian financial system is prepared for tomorrow. The plan is designed to respond to rapid changes in APRA’s operating environment,…
FATCA/CRS (ATO): The ATO has issued a self-review guide and toolkit on the internal processes and systems that reporting financial institutions should maintain to comply with the Foreign Account Tax Compliance Act and the Common Reporting Standard, which has been something of a focus for it in preceding years…
Conflicted Remuneration (ASIC): In Australian Securities and Investments Commission v Select AFSL Pty Ltd (No 2) [2022] FCA 786, the Federal Court of Australia held that conflicted remunerations contraventions took place for the Respondent, Select AFSL. Select AFSL was part of a corporate group structure which retailed…
Litigation Funders (Treasury): Well, that did not take long! Assistant Treasurer Stephen Jones has put himself on record, stating that the process of funder backed class action will be removed from ASIC and remitted to the Federal Court and state supreme courts. It follows Attorney-General Mark…
Crypto Legislation (US): I am not sure what is happening in the US with leaked documents recently, but the WSJ has leaked the draft crypto legislation which you can readhere. A dense document it is US legislation after all some of the key points are: the bill is centered around the terms digital asset…
Federal ICAC (Election): the election is over, and the red team has formed a majority Government. Importantly, the main election promise Labor has made on integrity is to establish what it says will be a “powerful, transparent and independent National Anti-Corruption Commission.”…
Breach Reporting (Research): Independent research commissioned by Gadens and Lawcadia on the enhanced AFSL/ACL breach reporting regime has been released this week. In summary, this research reveals: a marked increased in breach reporting for AFSL and ACL holders; a suggestion…
Litigation Funding Schemes (ASIC): ASIC has extended the relief from certain dollar disclosures in PDS’s for litigation funding schemes in ASIC Corporations (Disclosure in Dollars) Instrument 2016/767 until 1 October 2026. Relief has been extended by ASIC Corporations (Amendment) Instrument 2022/264…
Margin Requirements (APRA): The prudential regulator has made amendments to Prudential Standard CPS 226 Margining and risk mitigation for non-centrally cleared derivatives, by adding the UK’s Prudential Regulation Authority and Financial Conduct Authority to the list of foreign regulators in Attachment D…
Capital Adequacy (APRA): The prudential regulator has released for consultation the interim reporting standards that will accompany the updated capital adequacy and credit risk capital requirements for authorised deposit-taking institutions. It follows the release in November 2021…
Advice Update (ASIC): ASIC has released a consultation paper setting out its proposals to update Regulatory Guide 263 Financial Services and Credit Panel (RG 263) to reflect legislative changes in the Financial Sector Reform (Hayne Royal Commission Response Better Advice) Act 2021…
CCIV (Parliament): The Corporate Collective Investment Vehicle Framework and Other Measures Bill 2021 finally passed Parliament on 10 February. The CCIV regulatory framework utilises a company structure limited by shares so that it is recognisable to offshore investors and fund managers. As a company, a CCIV will generally be…
APRA priorities (APRA): The prudential regulator has released its policy and supervision priorities for the next 12 to 18 months. Policy priorities for 2022 include: a major multi-year initiative to modernise its prudential architecture; improving crisis preparedness, including finalising two new prudential standards…
Electronic Surveillance Laws (Home Affairs): The Government has released the Reform of Australia’s electronic surveillance framework discussion paper. The discussion paper seeks early views to inform the development of a new framework, and provides an overview of how the Government proposes to reform Australia’s…
Exchange Traded Products (ASIC): ASIC has released Consultation Paper 356 ETP naming conventions: Updates to INFO 230 (CP 356), seeking feedback on proposals to update the guidance in Information Sheet 230 Exchange-traded products: Admission guidelines (INFO 230), on naming conventions for licensed…
Liquidity Facility (APRA): APRA has issued a letter to banks announcing the aggregate Committed Liquidity Facility has reduced to $102 billion on 1 January 2022 from $140 billion on 10 September 2021.Since January 2015, those ADIs to which APRA applies the Basel III liquidity standards have…
Blockchain (Senate):the Senate Select Committee on Australia as a Technology and Financial Centre hasreleased its final report. There are some exciting recommendations read themhere(my top read for the week) including: 1) establishing a market licensing regime for Digital Currency Exchanges, including capital adequacy…
DI system (Treasury): the Federal Government has released an exposure draft of theTrusted Digital Identity Bill.It elates to the expansion of the DI System, which facilitates the creation of Digital Identity for individuals and allows businesses to use it for approved verification purposes. A Digital Identity only needs to be created…
ISG Financial Services v AFCA (AFCA):the Australian Financial Complaints Authority or AFCA is an external dispute resolution scheme for consumers who are unable to resolve complaints with member financial services organisations. Membership of AFCA is a requirement under law or license condition of virtually all…
Breach reporting for ACLs (ASIC):ASIC has issued a consolidated update to credit licence holders who are dealing with the new breach reporting regime. It has noted that licensees should already be registered on theASIC Registration Portalfor their annual industry funding obligations. However, individuals responsible…
Breach reporting (ASIC):the new breach reporting obligations implement recommendations from the Financial Services Royal Commission, and are included in theFinancial Sector Reform (Hayne Royal Commission Response) Act 2020. These obligations require AFSL and ACL holders to self-report specific matters to ASIC…
Anti-hawking provision (ASIC):ASIC has finally released its guidance (RG 38) setting out its expectations on the the hawking provisions in s992A and 992AA of theCorporations Act2001 (Cth). Under these hawking prohibitions, a person must not, in the course of, or because of, an unsolicited contact…
Licensing update (ASIC):ASIC has released a report outlining key issues, new and proposed changes to its licensing processes, and other work it has undertaken that affects licensees. Between July 2020 and June 2021, ASIC received 1,883 AFSL and ACL applications (an increase from 1,346 the previous year)…
Breach reporting (ASIC):the corporate regulator has released the new RG 78 to apply from 1 October 2021 for the new breach reporting regime. The primary shift under this new regime, which applies to both AFSL and ACL holders, is to a more expansive scope of reportable situations (i.e. matters that must immediately be reported to ASIC),…
Litigation funders (ASIC): as covered in last weeks update, the Government intends for litigation funders to hold an AFSL and litigation funding schemes will generally be subject to the managed investment scheme regime in Chapter 5C of theCorporations Act 2001(Cth). ASIC has madeASIC Corporations…
Product intervention power (ASIC):following its first victory against Cigno Pty Ltd (which is now subject to appeal),ASIC is doubling down against the Gold Coast payday lender and has releasedConsultation Paper 330(CP 330) on the proposed use of its product intervention power to address significant detriment…
Banking Code (ASIC): ASIC has approved a variation of the Banking Code of Practice from 1 July 2020, in the form of aspecial note. The variation, as suggested by the Australian Banking Association, involves the insertion of a Special Note into the Code to allow for special application of specified Code provisions until 1 March 2021…
Mortgage Brokers??BID (ASIC): the Australian Securities and Investments Commission (ASIC) has just released RG 273, which sets out its view on how mortgage brokers may comply with their best interests obligations which commence in January 2021. Consistent with the nature of the regime, and not unexpectedly,…
ASIC Corporate Plan (ASIC):ASIC has published itsInterim Corporate Plan, which sets out five priorities to tackle the challenges presented by the COVID-19 pandemic, including protecting consumers from harm at a time of heightened vulnerability and continuing to identify, disrupt and take enforcement action against…
Litigation Funders (Legislation):The Federal Treasurer has announced that litigation funders will within 3 months be required to hold an Australian Financial Services Licence (AFSL), which will dramatically increase the Australian Securities and Investments Commissions (ASIC) regulatory oversight of them…
Class Action Inquiry (Parliament):following the ALRC and VLRC reports into class actions, on 12 May 2020 the Federal Attorney General referred to the Parliamentary Joint Committee on Corporations and Financial Services for inquiry and report by 7 December 2020 the question as toWhether the present level of regulation…
Royal Commission Reforms (Treasury):huge news??and long sought and lobbied for??the Morrison Governmenthas announceda six month deferral to the implementation of commitments associated with the Hayne Royal Commission as a result of the significant impacts of the coronavirus. Under the updated timetable…
Modern Slavery (Legislation):I wrote last week about an underwhelming update from the Australian Border Force, specific to the fact that it did not address any revision of the timing of Modern Slavery reports. In the wake of broader comment, this week the Australian Government has extended the deadline for entities…
Unfair conduct: the ACCCs Chairman, Rod Sims, has restated that a new unfair conduct provision shouldapply across the economy, replacing unconscionable conduct provisions in legislation (and in equitable law), which a number of interest groups and some judges consider too narrowly framed…
Class actions / consumer protections: starting somewhat tangentially this week, albeit with more regulatory enforcement activity there are inevitably more class actions, Justice Parker of the NSW Supreme Court recently refused to approve a solicitors costs and a common fund order…
Binary options / CFDs: ASIC is having fun wielding its new product intervention power again. This time ASIC is aiming to address significant detriment to retail clients resulting from binary options (one of the more exotic options where the payoff is a liquidated sum or nothing) and contracts for difference…
ASIC v. Westpac:Justice Perram of the Federal Court handed down his decision in relation to proceedings ASIC commenced against Westpac connected with the responsible lending provisions of theNational Consumer Credit Protection Act 2009(Cth). The decision went against ASIC; Justice Perram found that Westpac…
Responsible lending:ASICs unusualpublic hearinginto responsible lending standards which essentially requires lenders to determine whether credit sought is suitable for a particular consumer kicked off in Sydney today. The hearings follow ASICs receipt of written submissions…
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