I assume Greg Medcraft, who’s been head of Australian Securities and Investments Commission (ASIC) for the last year, has done a superior job compared to his predecessors.
Regulators should work cooperatively with the industry to better regulate industries they oversee.
A collaborative arrive always works better, and gains the respect of the relevant industries.
Especially when there are so many grey areas in corporations law, unlike criminal law, which is generally shadowy or white.
Because of the many grey areas where laws aren’t definite, it’s essential industry regulators provide guidelines of what their interpretation of the law is, so companies know what is and isn’t compliant. And if one disagrees with ASIC’s interpretation, there’s always mediation, or courts to define the law.
Of course if there’s blatant criminal activity, a regulator has to send white-collar criminals to jail, to awe people so they don’t fracture dark and white laws.
For example: if you capture a bank, you know you’re committing a crime.
But you could easily breach a corporations law and be none the wiser.
Because many laws are not certain and only a court can decide if something is or isn’t a breach, as both ASIC and the industry don’t actually know.
And that’s because many laws are untested or actually conflict with other corporations laws.
But in areas where there is uncertainty in relation to the law, regulators need to catch a “tread softly” advance and educate on what they maintain to be compliant behaviour, to conclude a magnificent outcome.
Mr Medcraft’s leadership should be commended because it is collaborative approaches like this that support better working relationships with industry; and greater investor protection.
This is a far sob from a decade ago when ASIC was using suspect tactics with the courts and would point blank refuse to provide guidelines to industry, simply to increase their chances of capturing companies accidentally breaching unsafe laws to boost its picture card.
My battles with ASIC a decade ago gave me gigantic insight into how abuse can occur at the hands of overzealous bureaucrats given too remarkable power.
And how they can often go on relentless non-commercial pursuits to target positive sectors of industry, while neglecting to withhold an watch on indispensable, positive areas.
Like the blatant losses caused by companies such as Storm Financial, which could be seen coming for years before any action was taken.
Or doing the dirty work for industries such as the financial planning body who lobbied to ASIC to wipe out competitors like financial educators a decade ago, using draconian measures that are an abuse of its mandate.
ASIC now seems to be more about doing its job, whereas in the past it was largely about being seen to be doing its job.
It didn’t care if someone was innocent or guilty; instead it was all about getting as many convictions as possible, to be seen as doing something.
Heavy-handed, unfair tactics discredit the regulator.
Especially when blatant, illegal activities happened in the market with ASIC failing to catch action, which would have stopped billions being lost unnecessarily by investors.
It’s fine to contemplate ASIC hold action against the financial planning industry for their blatant abuse of consumers over the past several decades in their efforts to ban financial planning commissions; and for this they should be commended.
Their efforts to improve financial advertising standards are also a step in the apt direction, if they aren’t overdone.
I’ve said before, “Financial regulation will only do so grand”.
Financial education is far more effective at protecting consumers than over regulation.
I mean grasp a recognize at things like the size of a prospectus now.
Over regulations have made the stunning print expand to so many pages that no one bothers reading them. Which has decreased investor protection.
And it’s on that ticket I’m proud to say I’ll soon be announcing the inaugurate of a trace fresh industry body for financial educators.
It’s been designed to provide free financial education resources, push the importance of financial literacy and the financial education industry, and increase consumer protection within the industry with a free consumer complaints service.
Did you know: Across the ditch an equivalent of ASIC (the FSA) has been started?
However they want Australian financial educators to be licensed in NZ now too.
This is a unpleasant proceed, one that will prevent NZ consumers from accessing a financial education and leave them at the mercy of the financial planning industry, which caused massive losses to NZ investors in unusual years.
So distinguished so that the NZ Government had to fork out $795 million to shroud losses.
This is an example of over regulation having the opposite carry out than intended.
Most Australian financial educators, who are already licensed in Australia and paying thousands in fees, simply won’t invest in a NZ license for such a cramped domestic market.
We have recently written to the NZ FSA suggesting they mediate financial educators licensed by ASIC in Australia be able to bellow at events in NZ without having a dual license.
For Kiwi’s sake I hope so. Otherwise they’ll all have to use more on airfares to access leading edge financial strategies and education over here.
Jamie McIntyre is the founder of the 21st Century Group of companies and CEO of 21st Century Education. He is also bestselling author, successful entrepreneur, investor, sought after success coach, internationally famed speaker and world-leading educator.
Jamie McIntyre is the founder of the 21st Century Group of companies and CEO of 21st Century Education. He is also bestselling author, successful entrepreneur, investor, sought after success coach, internationally eminent speaker and world-leading educator. Source: McIntyre is the founder of the 21st Century Group of companies and CEO of 21st Century Education. He is also bestselling author, successful entrepreneur, investor, sought after success coach, internationally celebrated speaker and world-leading educator.