Powered by MOMENTUM MEDIA
the adviser logo
Growth

FSC supports heavier penalties for corporate crooks

by Reporter4 minute read

The Financial Services Council has backed the federal government’s decision to increase civil and criminal penalties for misconduct in the wake of the royal commission.

On Friday, Treasurer Scott Morrison announced that the government will be seeking reform of the Corporations Act to bring about what the government says is the “most significant increases in maximum civil penalties in 20 years”.

To continue reading the rest of this article, create a free account
Already have an account? Sign in

The announcement followed Mr Morrison’s description of conduct by financial institution AMP as “deeply distressing” and possibly serious enough for individuals to face jail time.

In response, the Financial Services Council — of which AMP and the big four banks’ wealth management divisions are members — has issued a statement welcoming the decision to bolster penalties.

Advertisement
Advertisement

“There is no place for criminality in the financial services industry and wrongdoing should be met with the full force of the law,” said FSC chief executive Sally Loane.

“It is entirely appropriate that penalties for civil and criminal misconduct are as strong as possible.

“Consumers must have confidence that the individuals and organisations they entrust with their savings will act in the right way.

“Both effective enforcement of the law as well as severe punishments for wrongdoing are central to promoting better trust and confidence.”

The statement comes despite the FSC previously mounting strong opposition to the notion of a royal commission into the financial services industry.

Speaking at a Pritchitt Partners event in Melbourne in July 2017, Ms Loane said that a royal commission would prevent self-regulation efforts.

“We are uniquely placed to take up the mantle of consumer reform so that the government can get on with its job of governing,” Ms Loane said.

“Proving as an industry we can regulate ourselves also strengthens consumer trust in the sector. In this light, we are concerned about a proposal that could act as a handbrake on self-regulation.”

Ms Loane said at the time that she was concerned that previous inquiries had already cost the industry $3 billion.

FSC supports heavier penalties for corporate crooks
redtape
TheAdviser logo
redtape

James Mitchell

James Mitchell

AUTHOR

James Mitchell has over eight years’ experience as a financial reporter and is the editor of Wealth and Wellness at Momentum Media.

JOIN THE DISCUSSION

You need to be a member to post comments. Register for free today

MORE FROM THE ADVISER

Anja Pannek CEO PLAN

Anja Pannek named MFAA CEO

The board of the Mortgage & Finance Association of Australia (MFAA) has confirmed that Anja Pannek will be the...

READ MORE
mike felton mfaa ta jdayl5

Aggregator heads reflect on Mike Felton’s legacy

Following on the news that Mike Felton is to retire next month and step down as chief executive of the Mortgage &...

READ MORE
melanie kiely afg ta mzh8zm

AFG non-executive director steps down from board

Australian Finance Group Ltd (AFG) has advised that Melanie Kiely will be stepping down from the AFG board to...

READ MORE
magazine
Read the latest issue of The Adviser magazine!
The Adviser is the number one magazine for Australia's finance and mortgage brokers. The publications delivers news, analysis, business intelligence, sales and marketing strategies, research and key target reports to an audience of professional mortgage and finance brokers
Read more