The Australian Securities and Investments Commission (ASIC) is just weeks away from filing lawsuits against the country’s biggest banks, as the regulator increases its active investigations, Reuters reported on Monday (Aug. 19).
The agency said in a recently published report that it was going to add more analysts, investigators and lawyers to ensure ASIC has the ability to probe “and where necessary litigate against, market, corporate and financial sector misconduct,” the report said.
Regulators in Australia are being tasked with auditing big financial institutions following an investigation that discovered deceptive tactics like trying to upsell low-income people and charging fees without giving anything in return.
The number of enforcement investigations being conducted into what the agency calls “the big six” grew by a fifth in a little more than a year, according to the report. ASIC Deputy Chair Daniel Crennan said the latest proceedings would be issued by year-end. He added the regulator had “a very large number of investigations on foot and there will be cases being issued in coming weeks, which are the result of those investigations,” the report said.
The big six refers to Australia’s four largest retail lenders and two key financial firms: Commonwealth Bank of Australia, Westpac Banking Corp, National Australia Bank, Australia and New Zealand Banking Group, investment bank Macquarie Group and financial planner AMP, according to the report.
Former ASIC Chairman Greg Medcraft warned earlier this month of a potential Enron-style corporate collapse due to the failings of the nation’s auditing industry.
Big banks defended their use of auditors as consultants, which led to allegations of conflicts of interest. The Parliamentary Joint Committee on Corporations and Financial Services is being pressed by some to investigate those claims and examine the state of the auditing industry overall. Declining audit quality runs the risk of high-profile corporate collapses described as the “gatekeepers” that “facilitate trust,” Medcraft said.