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ASIC independence ‘faces threat’, warns Labor

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Reporter 1 minute read

The Shadow Treasurer has suggested that the “independence of and bipartisan support for” the financial services regulator could be threatened if government appoints Credit Suisse chairman John O’Sullivan as the new ASIC head.

Labor minister Chris Bowen MP, the federal member for McMahon, issued a warning today (20 September) that his party would “not support Mr O’Sullivan’s appointment, should it proceed”.

According to reports in Fairfax Media, the government is considering replacing outgoing ASIC chairman Greg Medcraft with the former general counsel for Commonwealth Bank of Australia in November.

However, Labor has strongly opposed such an appointment, stating: “Reports that the Turnbull Government intends to proceed to appoint John O'Sullivan as chair of ASIC threaten the independence of and bipartisan support for this important regulator. 

“Labor makes it very clear, we will not support Mr O'Sullivan's appointment, should it proceed. 

“Labor does not do this lightly. We do this in light of our most serious concerns and our respect for the importance of ASIC's independence.”

Mr Bowen stated that the reputation of the corporate regulator and its leadership should be “beyond reproach” and alleged that the appointment would “raise serious questions around ASIC’s independence and its ability to command trust across markets and the Parliament”.

The Shadow Treasurer’s main concerns centred on the belief that the Credit Suisse chairman was non-partisan.

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Mr Bowen highlighted that Mr O’Sullivan has been a Liberal Party member in Mr Turnbull’s electorate, a president of the Liberal Party’s Wentworth federal electoral conference and previously donated to Mr Turnbull’s Wentworth Forum.

He said: “Australia has well-respected economic regulators based on a tradition of non-partisan appointments.

“If the Prime Minister and Treasurer were so foolhardy as to proceed with this appointment, this matter would go directly to the poor judgement of the Prime Minister and Treasurer.”

He continued: “The Australian Securities and Investments Commission has a vital role to play in regulating financial conduct and protecting Australian consumers, and the last thing it needs is this sort of controversy fixing itself upon ASIC’s leadership team.”

[Related:  'I'd do it': ASIC chairman would place consumers in larger loans]

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