The chairman of Australia’s corporate watchdog has called for “individual accountability” to be strengthened in banking and financial institutions, and said he looked favourably at the firing of employees on Wall Street.
The Australian Securities and Investments Commission chair, Greg Medcraft, appeared on ABC Lateline on Tuesday evening and faced repeated questioning about the conduct of the banking industry and the ability of the regulator to enforce standards.
After Four Corners revealed misconduct by the Commonwealth Bank’s insurance arm, Comminsure, regulators have been under pressure to clamp down. There have been no criminal prosecutions as a result of any misconduct, despite a series of reviews.
Medcraft urged a greater focus on “individual accountability” within banking institutions but stopped short of making an outright call for banks to sack financial advisers caught engaging in misconduct.
“One of the things that is really coming back, and I think the bank’s acknowledged that, is that individual accountability has got to be strengthened inside banks,” he said.
He continued: “One of the issues I think that we’ve seen on Wall Street is that they’ve recognised this problem and started to fire people.”
When asked whether Asic had enough resources to tackle serious financial crime, Medcraft said the regulator did “the best we have with the resources we have.”
The government has been under heavy pressure from Labor to establish a royal commission into the banking sector. The prime minister, Malcolm Turnbull, has continued to reject calls for a commission.
When asked about whether a commission was needed, Medcraft said: “A royal commission is an issue for government.
“At the end of the day it’s about getting more cops on the beat … and looking at giving us penalties that can really hurt.”
Asic will appear before Senate estimates on Wednesday morning.
