The corporate regulator is claiming success with its crackdown on the insolvency profession and says it will continue to be a key area of focus, The Australian has reported.
The Australian Securities & Investments Commission has broken new ground by issuing its first annual report into the insolvency industry, identifying and describing recent enforcement actions in the wake of being granted additional funding to increase surveillance.
Admitting the new enforcement regime “comes off a low base”, deputy ASIC chairwoman Belinda Gibson said yesterday that last year, when it had been given an extra $11.4 million a year, ASIC opened eight probes into registered liquidators and took punitive measures against three: John Lord, Peter Ngan and Atle Crowe-Maxwell.
Mr Lord had his registration cancelled while Mr Ngan was suspended as a liquidator for 2 1/2 years and Mr Crowe-Maxwell signed an undertaking relating to independence.
ASIC’s move to publicise its enforcement activity comes in the wake of the case of Newcastle administrator Stuart Ariff, who last December was jailed for at least 3 1/2 years for a series of dishonesty offences dating back almost a decade. ASIC was first warned of his activities in 2005 but did not take court action against Ariff until 2009.
That case and the surrounding publicity triggered in 2009 a Senate inquiry into the industry, chaired by Nationals senator John Williams. In 2010, it proposed the entire supervision of the industry should be handed over to a new body, staffed mostly by former ASIC staff.
However, the then parliamentary secretary to the treasurer, David Bradbury, chose instead to keep the surveillance role inside ASIC with extra funding.
Ms Gibson pointed out yesterday that she did not believe the industry had any more than a tiny number of “bad apples”.
“The industry is largely populated by highly motivated and reputable individuals,” she said, noting that more than half of the 426 complaints against liquidators last year stemmed from a misunderstanding of their role. She said that at the end of last year, there were 671 registered liquidators in Australia, of which 523 were also official liquidators.
She added that complaints against liquidators made up about 3.5 per cent of the 75,951 reports and inquiries that ASIC received during the 5 1/2 years to December 31 last year.
