Will ASIC prosecute ASIC?

Why not litigate?  That is the question.

According to ASIC:

As a director, you are responsible for oversight of the affairs of the company.


As a director, you must be fully up-to-date on what your company is doing, including its financial position, question managers and staff about how the business is going and take an active part in directors’ meetings.


When you make a business decision as a company director, you must, amongst other things, ensure that you (among other things):

  • do not have a material personal interest in the decision and make it in the best interests of the company
  • keep informed about your company’s financial position and performance, ensuring your company can pay its debts on time
  • make full and frank disclosure about any material personal interests you do have

Still, according to ASIC:

The chairman of the corporate watchdog, James Shipton, did not tell senior colleagues for more than a year that the Auditor-General had raised concerns about a housing allowance of almost $70,000 paid to one of his deputies, acting chairwoman Karen Chester has said.


She said the full leadership commission at ASIC was not aware of Mr Shipton’s $118,557 KPMG tax services bill that was paid for by ASIC in 2018, until after the Australian National Audit Office expressed concern in September this year.


Ms Chester suggested that most of the commission was kept in the dark about the auditor taking issue in August 2019 about $750-a-week housing payments for Mr Crennan after he relocated from Melbourne to Sydney for work.

ASIC has pursued the organisations is regulates for less.  Consider paragraph 109 from Justice Beach’s judgement in ASIC vs Harold Mitchell:

109    Further, ASIC says that by not disclosing to the TA board at its meeting on 3 December 2012 the level of interest of Network Ten in the domestic broadcast rights, Mr Mitchell contravened s 180(1). Further, he contravened s 182(1) because he used his position improperly as he concealed relevant information from the board on a subject of financial significance for TA to gain an advantage for Seven.

So the question at hand is … why not litigate?

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11 Responses to Will ASIC prosecute ASIC?

  1. Terry

    Yep, we’ll get right on that. Just need to “employ” a few more assistants, administrators, and diversity officers before we can “make that happen”. We’ll get back to you, right after we work out the bill to industry.

  2. H B Bear

    ASIC is a much bigger deal than Australia Post. Somebody better tell SloMo. Comments in Teh Paywallian said he was a Goldman Sachs Waffleworth appointment?

  3. H B Bear

    Comments on a newspaper site are 10x more useful than anything they publish. If the kiddie j’ismists let them through that is.

  4. Suburban Boy

    ASIC does not prosecute. It cannot.

    The DPP prosecutes offences which ASIC identifies and investigates.

  5. John A

    Hopefully, the equivalent of the Fifth Amendment is not going to be applicable here.

    However, what is the chance of ASIC dobbing itself in to the DPP?

    My estimate: a dead heat between two…

  6. covid ate my homework

    Ahh….as usual the revolving door keeps spinning.

  7. The Sheriff

    Isn’t the guy who got the tax advice the one that was recruited from the US? If so, $100k for tax advice is probably not surprising for someone like that given how complicated the US and Aussie systems are and that he would need to comply with both

  8. H B Bear

    I know what would have happened to me if I got a $20k quote for the directors and went back to them with a bill for nearly $120k. That’s life as a minion, not in ASIC obviously.

  9. Albatross

    Suburban Boy
    #3635638, posted on October 28, 2020 at 1:37 pm
    ASIC does not prosecute. It cannot.

    The DPP prosecutes offences which ASIC identifies and investigates.

    Don’t be so obtuse and wrong. ASIC does summary prosecutions itself, and the CDPP don’t prepare briefs. If ASIC don’t investigate and refer a brief there is no prosecution.

  10. Destroyer D69

    Are these responsibilities also applicable to the members of the board of management of an incorporated association.??????

  11. Suburban Boy

    At the risk of being geometrically inappropriate …

    ASIC is not a company and the members of its board are not directors. The law it regulates in relation to companies and their directors does not apply to ASIC and its board members (who are called “members of ASIC” formally, but are usually known as “commissioners”).

    As a result, there is nothing within the regulatory scope of ASIC that empowers it to investigate, let alone litigate or of course prosecute, the actions of its own members qua members of ASIC.

    Since this comments thread includes some whose pedantry rivals even mine, I will make one reservation to the forgoing comments: it would, in theory, be open to ASIC to sue one of its members or former members under a common-law (or equitable) cause of action. However, a more sensible approach to any civil action would have it conducted by the Attorney-General’s Department on behalf of the Commonwealth, rather than by ASIC itself.

    Any alleged criminal behaviour would be investigated by AFP as a possible offence against the Commonwealth Criminal Code (ASIC has no power to investigate offences under that law unless they are incidental to offences under the Corporations Act or ASIC Act).

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