What ASIC Has Done to Protect Investors in H1 2017

Australian watchdog releases its Market Integrity Report.

The Australian Securities and Services Commission (ASIC) has released its market integrity report for the first half of the year, ending 30 June 2017. It is basically a review of the work done by ASIC to ensure a free and fair market over these six months.

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The report deals with the focus of ASIC on varied topics such as cyber resilience, standards and education, sell-side research and market reform. It also discusses behavioral change, which ASIC monitors on a periodic basis, and disruption in the markets.

On the standards and education side, ASIC has issued an information sheet about the regulations surrounding blockchain technology. This technology has generated a lot of interest in the last few years and has been regularly used in the payments and remittance industries of late. The information sheet helps the user to evaluate the relevant regulatory requirements.

Listing Standards

In March, ASIC published a report on its assessment of the listing standards at the Sydney Stock Exchange and suggested a number of improvements regarding conflict management, proper monitoring and enforcement.

On the cyber resilience side, ASIC and the Australian Securities Exchange (ASX) periodically evaluate the risk-awareness of major companies in Australia and identified key trends, and advised them on the gaps in their risk management.

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Behavioral Change and Disruption

ASIC also monitors behavioral changes to identify trends and take quick action to prevent losses to investors. ASIC reiterated its commitment towards ensuring that proper mechanisms are in place at large institutions ensuring that financial services are provided in a clean and efficient manner.

As part of that, in March, ASIC ordered Westpac Banking Corporation and Australia and New Zealand Banking Group Limited (ANZ) to address gaps in their FX businesses.

ASIC also reported that it was maintaining a strict watch on disruptive behavior like insider trading. In April, it was able to get Steven Robert Noske imprisoned and fined for insider trading, and ASIC maintained that it would continue to treat insider trading very seriously so that people with access to market sensitive information treat it in a responsible manner.

Also, as part of its drive to keep the markets clean, the Markets Disciplinary Panel (MDP), a body that exercises ASIC’s power to issue infringement notices, issued eight infringement notices, imposing penalties totalling $1,265,000 in the first half of the year.

Looking ahead, ASIC reports that it will continue to work on the technology and operational risk of its stakeholders to help build their cyber resilience.

It will also conduct reviews and assessments to ensure market integrity and improve market surveillance.

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