The man who blew the whistle on the Commonwealth Bank’s financial planning scandal has called for a “wholesale cleanout” at ASIC.
Former Commonwealth Bank financial planner Jeff Morris, who alerted ASIC in 2008 to unethical conduct inside the bank, said the regulator has been “missing in action” ever since.
“I think there should be a wholesale cleanout at ASIC, quite frankly. My experience with them was absolutely appalling,” he told ABC television.
“And this isn’t something that happened years ago. Right up to the present time, ASIC has shied away from doing its job properly.”
Mr Morris said “CBA could never have dropped the ball in the way it has” if ASIC had performed properly.
He also said ASIC had been the “common denominator” in other recent financial scandals.
“I think if they had been doing their job, this sort of thing wouldn’t have happened,” he added.
Tim Sheehy, chief executive of the Governance Institute of Australia, called for a Royal Commission to investigate the financial planning industry and the performance of ASIC.
“Obviously, part of that Royal Commission would be looking at the role of the regulator – was it adequately staffed?” he told ABC television.
“And there are issues around funding for ASIC, and we have gone on record to say you get what you pay for.
“It has a very big brief and continual budget cuts, so there’s an issue there which cannot be ignored and has to be looked at.”
Mr Sheehy said more financial scandals were inevitable if ASIC wasn’t reformed.
ASIC said it had already taken steps to improve its procedures, including improving its transparency and its mechanism to identify emerging risks.
“ASIC will continue to do the best job we can with the resources we have,” it said.
“In the meantime, ASIC is getting on with the job the government has given it the powers to do, and that is to ensure consumers and investors are protected and markets are fair and efficient.”
[Related: Senate tells ASIC to lift its game]