April 11, 2017
ASIC will consider the creation of a three-member peer review panel which would be empowered to recommend the regulator ban financial advisers for misconduct.
The creation of the new Financial Services Panel was flagged by ASIC as it put out a call for industry consultation and feedback on its plans, which are the result of a recommendation in the 2015 ASIC Capability Review that the regulator consider peer-based co-regulation in its enforcement work.
In releasing Consultation Paper 281 Financial Services Panel, ASIC Chair, Greg Medcraft said the aim of the Panel was to enhance the impact of ASIC’s administrative decisions.
“The significance of being judged by peers cannot be underestimated. Peer review panels are a form of co-regulation in Australia and overseas,” Medcraft said.
“The Panel will also bring broader experiences and perspectives into ASIC’s decision making and ensure decisions reflect current industry practices and standards,” he added.
“The Panel will also bring broader experiences and perspectives into ASIC’s decision making…”
Under the proposals, the Panel would usually have three members with two of those members being financial services participants and/or non-industry participants, such as lawyers or academics, and at least one ASIC staff member. The final make-up of the panel is an area subject to consultation.
According to the consultation paper, the Panel would only hear matters that are referred to it by ASIC where those matters require peer review because of their ‘significance, complexity or novelty’.
The Panel would, however, be responsible for determining whether ASIC should ban individuals from the financial services industry in the matters that are referred to it.
The Panel would be the second body created by ASIC using adviser input following the creation of the 10-member Financial Advisers Consultative Committee in late March which provides feedback to ASIC on the impact of regulation on practicing advisers (See: ASIC Creates New Adviser Committee).
The Federal Government has also called on advisers in the area of professional standards and education appointing former AFA President, Deborah Kent and former FPA Board Chair, Matthew Rowe to the Financial Adviser Standards and Ethics Authority (See: Former AFA President Named to Professional Standards Body).
Submissions on Consultation Paper 281 Financial Services Panel are due by 23 May 2017.