In this month’s ASIC update:

‍

• ASIC announces enforcement priorities for 2025;
• NAB faces legal action over failure to support customers in financial hardship;
• ASIC releases draft guide for new sustainability reporting regime;
• ASIC Deputy Chair Sarah Court highlights a focus on protecting consumers in the credit system; and
• ASIC takes urgent action in ALAMMC Developments investigation.

‍

ASIC Announces Enforcement Priorities for 2025

‍

ASIC has outlined its key enforcement priorities for 2025, focusing on protecting consumers from financial harm and tackling emerging risks within the Australian financial system.

‍

Key Areas of Focus:

‍

• Superannuation Misconduct: Targeting exploitation of superannuation savings, including unscrupulous property investment schemes.

‍

• Debt Management & Collection: Addressing unlawful debt practices and business models that circumvent consumer credit protections.

‍

• Insider Trading: A new dedicated team will focus on strengthening investigations into insider trading.

‍

• Insurance & Consumer Protection: Holding insurers accountable for failures to act fairly and in good faith.

‍

• Vulnerable Consumers: Targeting financial products that exploit vulnerable groups, such as used car finance.

‍

• Greenwashing & ESG Misconduct: Cracking down on misleading environmental claims.

‍

• Cybersecurity Failures: Focusing on licensees with inadequate cybersecurity protections.

‍

ASIC's Deputy Chair, Sarah Court, highlighted that these priorities reflect the increased risks faced by consumers, particularly due to rising living costs. The regulator has ramped up its enforcement actions, with a 25% increase in investigations and a stronger focus on criminal cases.

‍

ASIC’s broader enduring priorities include tackling market integrity issues, consumer harm, and systemic failures by large financial institutions. 

‍

For more details, view the video on the ASIC website here.

‍

NAB Faces Legal Action Over Failure to Support Customers in Financial Hardship

‍

ASIC has filed documents in the Federal Court, accusing National Australia Bank (NAB) of failing to assist 345 vulnerable customers who applied for financial hardship support between 2018 and 2023. 

‍

The regulator alleges that NAB, along with its subsidiary AFSH Nominees Pty Ltd (AFSH), did not respond to these hardship requests within the mandatory 21-day timeframe, in breach of the National Credit Code.

‍

ASIC Chair Joe Longo criticised NAB's actions, highlighting that the affected customers included individuals experiencing domestic violence, serious medical conditions, job loss, and business closures. 

‍

This case follows ASIC’s broader focus on ensuring compliance with financial hardship obligations, which remains a key enforcement priority for 2024. The regulator has already signalled its intent to take decisive action against lenders who neglect their obligations to customers in financial stress.

‍

ASIC is seeking declarations, financial penalties, and adverse publicity orders against NAB and AFSH. This action is part of ASIC’s broader effort to improve consumer outcomes, particularly in light of rising cost-of-living pressures.

‍

For more information on how to seek help if you’re experiencing financial hardship, visit ASIC's Moneysmart website or contact the National Debt Helpline at 1800 007 007.

‍

This legal action follows similar enforcement against Westpac in 2023 for similar misconduct.

‍

ASIC Releases Draft Guide for New Sustainability Reporting Regime

‍

ASIC has released a draft regulatory guide on the new sustainability reporting regime, which will require large Australian businesses and financial institutions to prepare annual statutory sustainability reports starting from 1 January 2025. 

‍

The reports will need to include climate-related financial disclosures, and the draft guidance outlines how the regime will work, including who must report, how these reports will interact with existing legal obligations, and how ASIC will administer the requirements. 

‍

The focus is on ensuring that the sustainability reports provide high-quality, decision-useful, climate-related disclosures that comply with the law and the sustainability standards. ASIC is also seeking feedback from stakeholders through Consultation Paper 380, which addresses areas such as the potential extension of relief provisions related to financial reporting or audit requirements to sustainability reporting.

‍

The consultation is open until 19 December 2024, and ASIC is encouraging industry engagement to ensure effective support for the introduction of the new regime. 

‍

Industry stakeholders can refer to the ASIC website for more details and to access the consultation paper.

‍

ASIC Deputy Chair Sarah Court Highlights a Focus on Protecting Consumers in the Credit System

‍

In a recent speech at the Australian Financial Security Authority Summit, ASIC Deputy Chair Sarah Court outlined the regulator’s ongoing efforts to ensure good consumer outcomes in the Australian credit system. 

‍

Ms Court emphasised ASIC’s role as a steward in the credit system, working to drive positive change within businesses by promoting a culture of compliance and accountability. She discussed ASIC’s targeted efforts to tackle predatory lending practices and business models that circumvent consumer protections. This includes ongoing enforcement actions against lenders engaged in harmful conduct.

‍

One of the key areas of ASIC’s work is addressing financial hardship. The speech detailed ASIC’s extensive review of hardship notices from 30 large lenders and revealed that many consumers were not receiving adequate support. 

‍

As a result, ASIC launched a public campaign to raise awareness of consumer rights and has taken enforcement action against lenders, including initiating civil penalty proceedings against Westpac for failing to respond to hardship notices within the required timeframes.

‍

Finally, Ms Court addressed the importance of maintaining confidence in the credit system. She noted that when businesses fail to meet community expectations, it erodes trust in the sector. ASIC continues to collaborate with other regulators to promote a culture of compliance and protect consumers from harm.

‍

For further details, you can access the full speech on ASIC’s website here.

‍

ASIC Takes Urgent Action in ALAMMC Developments Investigation

‍

On 1 November 2024, the Federal Court appointed Helen Newman and Andrew Fielding of BDO as receivers for ALAMMC Developments Pty Ltd and 12 associated corporate entities. 

‍

The Receivers have been tasked with investigating the amount of investor funds received by the entities and must report their findings to the Court within 28 days.

‍

This action follows urgent steps taken by ASIC to secure asset preservation orders and the appointment of the same receivers over the personal property of ALAMMC Developments director, Mr David McWilliams, and his wife, Ms Laura Fullarton. 

‍

At the same hearing, Justice O’Sullivan also extended the travel restrictions on Mr McWilliams, prohibiting him from leaving Australia until 1 July 2025.

‍

The companies involved in the investigation offered investment opportunities related to purpose-built NDIS-compatible property development schemes across Australia. 

‍

ASIC’s investigation into these entities began after receiving information regarding Mr McWilliams’ gambling activities and their potential use of investor funds from 1 January 2021.

‍

The entities currently under investigation and subject to asset preservation orders include:

‍

• ALAMMC Developments Pty Ltd
• ALAMMC Developments 2-7 Pty Ltd
• SDAMF 2-4 Pty Ltd
• Mortgage Mutual Fund Pty Ltd
• Harvey Madison Capital Pty Ltd
• Coral Coast Mutual Fund Pty Ltd

‍

ASIC states it is actively working to protect the interests of investors and has provided a dedicated investigation page, which includes detailed information and frequently asked questions for concerned investors.

‍

For more information on the investigation, visit the ALAMMC Developments investigation page.

‍

The contents of this article do not constitute legal advice and it is not intended to be a substitute for legal advice and should not be relied upon as such.  It is designed and intended as general information in summary form, current at the time of publication, for general informational purposes only.  You should seek legal advice or other professional advice in relation to any particular legal matters you or your organisation may have.

‍