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Regulation: ASIC Focus

Thursday 24 March 2022

The Australian Securities and Investments Commission (ASIC) has highlighted  three areas of future focus this week. 


On the international space the  international organisation of securities commissions (IOSCO) will
consulting on retail market conduct space to tackle to retail market conduct issues. 

In an official statement this week the IOSCO said, “Increased retail participation in securities markets could mean retail investors increasingly influence market trends and pricing, with corresponding regulatory implications for retail market conduct. Increased retail participation carries with it the threat of misconduct. Misconduct in capital markets has far reaching consequences for financial consumers, investors, national economies, and the overall global financial system.”

In their official statement the international securities organisation shows that misconduct in this space has been more than just  a threat since start of the pandemic finds study that Isos co conducted last year.

“Since the onset of the COVID-19 pandemic, IOSCO has observed rising cases of misconduct and reported investor losses, some of them cross-border in nature.”
Australia and the World
ASIC Commissioner Sean Hughes, “This is a worldwide phenomenon, and likely to be an on-going challenge for regulators and the broader investment community, especially where the harm is digitally-enabled.”

Consultation deadline 23 May. 
Social Media Influencers
The securities regulator is casting is looking ‘finfluencers’ , with some information obligations are social media and the licensees.

ASIC Commissioner Cathie Armour said in an official statement, “The way investors access information is changing. It is crucial that influencers who discuss financial products and services online comply with the financial services laws. If they don’t, they risk substantial penalties and put investors at risk.”

At the end of last year, the ASIC published results of survey that the found that 28 per cent  of young people  follow a financial influencer and the 64 per cent of ‘young people’ have, changed at least one financial behaviour as result of following social media influencers. 

information paper is to help social media influencers their rights and obligations:

  • highlights activities where influencers may contravene the law if they are unaware of the legal requirements, using a series of practical examples on:
  • explains issues for influencers to consider including:
  • reminds AFS licensees who use influencers to:
  • do their due diligence
  • have appropriate risk management systems and monitoring processes
  • have sufficient compliance resourcing to monitor the influencers they use
  • consider their design and distribution obligations.
 Marketing Financial Products 
The Australian securities and Investments Commission (ASIC) will be focusing on the marketing of managed  funds. 

Is an official statement  the securities and investments regulator said “ ASIC is concerned that, in the current highly volatile and low-yield environment, consumers seeking reliable or high returns are being misled about the performance and risks of the funds they are investing in. This surveillance follows on from ASIC’s ‘True to Label’ initiative, which examined whether representations in fund labels may have misled consumers about the funds’ characteristics and underlying assets.”

Deputy Chair Karen Chester said that surveillance is  broadening  and said in an official statement, “ASIC remains concerned that managed fund promoters continue to target consumers, particularly retirees or those planning for retirement, with ambiguous or misleading performance and risk representations. Where we identify fund marketing of concern, we will also review the corresponding product disclosure statements, websites, and target market determinations to assess if the marketing claims are misleading.”

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