The Australian
Securities and Investments Commission (ASIC) took down 6,900 investment
scam and phishing websites in the year ended June 30, according to
its annual report released today (Wednesday), as the regulator ramped up
efforts to protect consumers from online fraud.
Australian Regulator Shuts
6,900 Sites
The
takedowns included roughly 2,800 fake investment platforms, 2,400
cryptocurrency scams, 1,400 phishing links and 250 fraudulent online
advertisements. ASIC added 1,035 warnings to its Investor Alert
List and published consumer advisories about schemes targeting
retirement savings.
Chairman Joe
Longo said the agency’s investments in digital capabilities had
delivered results. Formal investigations jumped 50% from the prior year,
while new civil enforcement proceedings increased nearly 20%. The
regulator completed 829 targeted surveillances across financial services
sectors.
“ASIC
responds to emerging challenges in the broader financial ecosystem,
from the advent of AI to the increasing dominance of private credit
in our capital markets,” Longo commented in a statement
accompanying the report.
Courts Hand Down $120
Million in Penalties
The regulator
secured $104.1 million in civil penalties through court proceedings,
up from $90.8 million the previous year. Criminal prosecutions
resulted in an additional $16.8 million in fines, a substantial
increase from $936,000 in 2023-24. The agency launched 38 new civil cases
during the fiscal year.
Nineteen
defendants received criminal convictions, with 14 receiving custodial
sentences. Six people were imprisoned. Courts imposed five non-custodial
sentences. ASIC also issued 16 infringement notices totaling $5.6 million
in penalties.
The agency
prosecuted 235 individuals for strict liability offenses, resulting in
$1.6 million in fines. Summary prosecutions rose almost 26%
compared with the previous year.
Superannuation Funds Face
Legal Action
ASIC
took enforcement action against
two major superannuation trustees over delayed death benefit
claims. The regulator sued United Super, trustee of the Cbus fund, alleging
more than 10,000 members waited over 90 days for
claim processing. Some families waited longer than 12 months,
according to court filings.
The agency
filed separate proceedings against AustralianSuper,
Australia’s largest pension fund, over claims that took between four
months and four years to process. ASIC alleged at least 6,699 claims
were delayed between July 2019 and October 2024.
Banking Sector Under
Scrutiny
ASIC filed
its first court case alleging a bank failed to protect customers from scams. The
December lawsuit against HSBC Bank Australia claims inadequate
systems allowed about $23 million in customer losses from
unauthorized transactions between January 2020 and August 2024.
Nearly $16 million of those losses occurred in six months from
October 2023 to March 2024.
The
regulator reviewed anti-scam practices at 15 banks outside the
four major institutions. The August report found scam detection and
response measures “less mature than expected,” with
governance structures focused on fraud rather than scams. Customers
bore 96% of total scam losses during the review period.
Related
stories: ASIC
Admits Its Own Rules Were Too Complex, Deletes 9,000 Pages of Red Tape
Operational Overhaul
Delivers Results
The
regulator processed 1,531 licensing and registration applications,
approving 1,021 and refusing or receiving withdrawals on 360. ASIC canceled or
suspended 215 Australian financial services licenses and 253 credit
licenses during the year.
The
agency restricted or banned 58 individuals or companies from
providing financial services and removed 33 from the credit industry.
Fourteen people were disqualified or removed from
directing companies.
ASIC
registered 333,188 new companies and 386,519 business names. The
Moneysmart consumer education website attracted 11.7 million visitors, with 8.1
million using online financial tools.
The regulator
operates under a cost-recovery model and collected $1.9 billion in fees,
charges and supervisory levies on behalf of the Commonwealth during the
fiscal year.
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This article was written by Damian Chmiel at www.financemagnates.com.
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