ASIC pledge to get tough on rogues

AUSTRALIA’S largest bank was worried it would it would be seen to be “paying off ASIC” as the corporate regulator took a soft approach to financial misconduct that it later admitted was a mistake.

Some other companies that got off easily now face the possibility of court action as the Australian Securities and Investments Commission pledges to be a tougher corporate cop.

ASIC chairman James Ship- ton conceded the financial regulator made mistakes - not failings - in handling misconduct cases in the past.

It now plans to take criminal and civil action more often, rather than negotiating resolutions with the big banks and others.

“Yes there are case studies where, in my view, we should have, if the case was before us today, pursued criminal sanctions,” Mr Shipton told the banking royal commission yesterday.

ASIC only adopted a new approach that immediately considers litigation two or three weeks ago, after being slammed by the royal commission for rarely going to court and letting much financial misconduct go unpunished.

All cases aired at the inquiry are being reviewed.

One of ASIC’s mistakes involved misleading ads about trauma coverage for heart attacks run by the Commonwealth Bank’s CommInsure business.

CommInsure faced up to $8 million in fines but walked away with a $300,000 community donation.

Mr Shipton, the ASIC chair since February this year, said it was extremely concerning.

He said there were many lessons from the CommInsure case, including that it was wrong to negotiate the contents of a media release about the matter with the bank.

“Today these matters would be handled very differently,” Mr Shipton said.