Does ASIC only take on small operators and leave the big end of town untouched? That's the criticism that was raised in the inquiry into the regulator's performance.
In the newly released final report of the Senate Economics Committee's Inquiry into ASIC's performance, the committee raised the question of whether ASIC was too slow to take on "the big end of town".
"Various concerns were expressed and assertions made about ASIC's enforcement record against large companies or well-resourced individuals. It is evident that a perception that ASIC is reluctant to investigate and take action against big business exists," the report said.
The inquiry said submissions suggested ASIC was reluctant to take on complex court cases, instead preferring "easier targets", and that the regulator did not have the resources to take on well-resourced firms. It was also suggested that when ASIC did take enforcement action against large businesses, such action came in the form of less severe remedies such as enforceable undertakings. The report quoted a submissions from CPA Australia that questioned the regulator's focus.
"Last month saw the release of the enforcement outcomes July to December 2013. They appear to indicate that there were three times the number of enforcement outcomes against small business in the last year than there were against the big end of town," CPA Australia said.
In its testimony to the inquiry, ASIC rejected the suggestion, though conceded that such a perception exists. In a written statement, ASIC commissioner Greg Medcraft claimed that "ASIC acts without fear or favour irrespective of the size of the organisation".
But the Senate Committee argued that there appeared to be "a disinclination to initiate court proceedings, or a penchant within ASIC for negotiating settlements and enforceable undertakings. The end result is that there is little evidence to suggest that large entities fear the threat of litigation brought by ASIC".
