The Treasurer and the Minister for Revenue and Financial Services have announced that the Government is strengthening criminal and civil penalties for corporate misconduct. There are also plans to boost the powers of the Australian Securities and Investments Commission (ASIC) to protect Australian consumers from corporate and financial misconduct. These reforms are intended to bring Australia into closer alignment with leading international jurisdictions and to be a credible deterrent to unacceptable misconduct. The announced reforms to ASIC's powers and penalties follow recommendations made by the ASIC Enforcement Review Taskforce. Currently, there is no official timetable for when and how the reforms will be made effective.
The Government will increase and harmonise penalties for the most serious criminal offences under the Corporations Act to a maximum of:
- For individuals – 10 years' imprisonment; and/or the larger of $945,000 or three times the benefits accrued.
- For corporations – the larger of $9.45 million; or three times the benefits accrued; or 10% of annual turnover.
The Government will expand the range of contraventions subject to civil penalties, and also increase the maximum civil penalty amounts that can be imposed by courts, to the maximum of:
- the greater of $1.05 million (for individuals, from $200,000) and $10.5 million (for corporations, from $1 million); or
- three times the benefit gained or loss avoided; or
- 10% of the annual turnover (for corporations).
Further planned developments include the development of ASIC’s power to:
- ban individuals from performing any role in a financial services company where they are found to be unfit, improper, or incompetent;
- refuse, revoke or cancel financial services and credit licences where the licensee is not fit or proper; and
- investigate and prosecute serious offences by harmonising their search warrant powers to provide them with greater flexibility to use seized materials, and granting ASIC access to telecommunications intercept material.