On Wednesday, 29 July 2015, ASIC announced it would be actively using the power under section 91 of the Australian Securities and Investments Commission Act 2001 (Cth) to recover costs and expenses of its investigations.
Section 91 provides that ASIC may make an order to recover investigation costs and expenses in certain circumstances.
Historically, ASIC has rarely exercised that power, yet it has now “reviewed its approach and considers that it should more frequently seek to recover the expenses and costs of an investigation from the person who has caused those expenses and costs to be incurred“.
While this is obviously concerning news for those involved in ASIC investigations, it is also concerning for insurers who provide cover against such investigation costs. Of course, it remains to be seen how often such orders are made by ASIC, and in what circumstances.