13 April 2016
Media Release - #2016041, 2016

The facts – ASIC and Royal Commission

The Government has received specific advice on the extensive and ongoing powers of ASIC that directly refute the erroneous claims made by Labor and the Shadow Treasurer. These are set out below.

The facts Opposition claim
[Chris Bowen media release]
The facts

The Opposition is disputing that ASIC has more powers than a Royal Commission.

ASIC is a standing independent statutory authority that has broad investigative powers and a wide remit. ASIC doesn't need to be commissioned like a Royal Commission. A Royal Commission needs terms of reference and requires approval to vary or extend those terms of reference. A Royal Commission is restricted to investigating matters within its terms of reference.

ASIC has the power to prosecute – a Royal Commission does not.

Specific Opposition claims The facts

ASIC investigations are conducted in private, even when there is compelling public interest in the matter. Only a small proportion of matters dealt with by ASIC lead to prosecution.

This is incorrect.

ASIC can hold hearings in public or in private.

ASIC can begin an investigation at the instruction of a Minister, the request of a liquidator, or when it suspects an offence has been committed – a Royal Commission can investigate any issues, even matters that are obviously permitted within our current laws.

ASIC can and has investigated matters that are permitted within our current laws.

For example, ASIC investigated misleading financial products, even when there was no breach of law, and achieved outcomes.

ASIC does not have the power to arrest a person who refuses a summons - a Royal Commission does.

ASIC does not have arrest powers, but can apply to a court on an urgent basis (the same day if necessary) to enforce its summons (s.58) or examination notice (s.19) to compel a person to appear. The Royal Commission can issue a warrant for non-appearance on a summons but needs the police to execute the warrant (s.6B).

ASIC does not have the power to compel a person to answer questions, unless they are relevant to an offence – but it is an offence to refuse to answer questions at a Royal Commission.

This is incorrect.

ASIC does have the power to issue summons compelling people to appear at a hearing to give evidence under oath and produce documents (s.58).

Additionally, ASIC has coercive powers to require appearance of witnesses for examination. Failure to appear for examination can carry a penalty of 100 penalty units and/or 2 years in prison.