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Screenshot of a breaking news alert e-mail from Q2 2017
Not many institutions, corporate or government, come out with serious multi-year plans.
However Australia financial regulator ASIC has done just that.
With increased government funding in tow, ASIC has come out with a fairly ambitious multi-year plan aimed at further reforming the Australian financial scene. Specifically, ASIC plans to use the additional funding support announced by the government over the next four years to better detect misconduct through more proactive surveillance that target poor practices – at the individual firm and industry level.
The plan revealed seven new surveillance projects (see chart below) initiated recently by ASIC. One of the projects entitled Market Intermediaries will cover Retail structured products sales and advice practices. Mainly, that project is studying structured products issuers aimed at Retail investors, liquidity providers and distribution through white label firms. It will cover hybrids and complex structured products, as well as OTC retail derivatives such as foreign exchange, contracts-for-difference (CFDs) and binary options.
One of the key challenges ASIC said it is facing is what it calls digital disruption and cyber resilience in the financial services sector. It also noted that while it supports the benefits of financial innovation such as lower trading costs and more tailored products available for traders, it also must deal with the risk that new products may not align with consumers’ needs or understanding.
A list of the ASIC surveillance projects, continuing and new, include:
ASIC’s full four-year corporate plan can be seen here.