With the end of the year approaching, ASIC has announced its enforcement priorities for 2024. While many of ASIC’s long-standing focus areas remain unchanged, the regulator has also introduced several new and expanded priorities that businesses, advisers and financial institutions should be aware of.
Enduring enforcement priorities continuing into 2024
ASIC has confirmed that its core enforcement priorities will continue. These include:
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Maintaining market integrity
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Protecting financially vulnerable consumers
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Investigating misconduct impacting First Nations people
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Addressing systemic failures within the financial system
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Monitoring and responding to new and emerging conduct risks
These areas remain central to ASIC’s regulatory approach and will continue to attract close scrutiny.
Sustainable finance and product distribution
Building on its work in 2023, ASIC will continue enforcement action targeting:
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Poor distribution of financial products
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Misleading or deceptive conduct in relation to sustainable finance, commonly referred to as greenwashing
However, ASIC has dropped its previous priority of investigating misconduct involving high-risk products such as crypto assets. This reflects a shift in focus toward areas where ASIC believes consumer harm is more widespread.
Increased focus on superannuation compliance
Superannuation has emerged as a major enforcement priority for 2024. ASIC has already begun taking action in this area, with a strong emphasis on whether super funds are acting in the best interests of their members.
A key concern highlighted by ASIC is the widespread failure of super funds to merge duplicate super accounts. ASIC has made it clear that it expects to take further enforcement action where funds fail to adequately protect members’ retirement savings.
Predatory lending and financial hardship obligations
Predatory lending has been elevated as a priority area, particularly where vulnerable consumers are involved.
ASIC has also identified the following as new enforcement priorities for 2024:
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Insurance claims handling
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Compliance with financial hardship obligations
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The reportable situations regime
ASIC has already commenced enforcement action in these areas, including court proceedings against major financial institutions for alleged failures to properly address hardship notices and for misleading conduct relating to credit card products.
Misconduct in used car financing
ASIC will also target misconduct relating to used car financing, particularly where vulnerable consumers are affected. This focus extends across the entire distribution chain, including:
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Finance brokers
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Car dealers
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Finance companies
The regulator has signalled that enforcement action in this area will be robust.
Gatekeepers under increased scrutiny
Gatekeepers will continue to be a major focus in 2024. ASIC will take action against:
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Auditors
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Registered liquidators
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Financial services licensees
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Credit licensees
Where these parties fail to meet their legal and professional obligations.
Technology and operational resilience
As financial markets become increasingly digitised and automated, ASIC has introduced a new priority around technology and operational resilience.
This priority focuses on ensuring that market operators and participants manage technical and operational risks effectively in order to maintain market integrity and stability.
Small business impacts and directors’ duties
Conduct impacting small businesses, including misconduct affecting small business creditors, has been added to ASIC’s 2024 priorities.
In addition, ASIC has broadened its focus on governance and directors’ duties failures. What was previously a 2023 priority limited to certain property schemes has now been elevated to an enduring priority covering governance failures across all sectors.
ASIC’s enforcement stance going forward
ASIC Deputy Chair Sarah Court has made it clear that the regulator is prepared to:
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Take more matters to court
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Seek higher penalties than ever before
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Pursue complex and challenging cases, even where legal outcomes are uncertain
ASIC will also continue testing the scope of existing laws to ensure they provide strong protection for consumers, investors and market integrity.
Speak to our accountants
If you have questions about how ASIC’s 2024 enforcement priorities may affect your business or personal financial affairs, speak to one of our accountants if you have any questions about the changes in tax for 2023.
