A report on the first nine months of the breach reporting regime released by the corporate regulator on Thursday (27 October) revealed that only 6 per cent of the licensee population lodged a report.
Moreover, 74 per cent of all reports were lodged by just 23 licensees.
ASIC was quite underwhelmed by the take-up and said it would undertake a “number of activities” to strengthen compliance with the regime.
But the corporate regulator also confirmed that from next year, it could start naming the licensees reporting the breaches.
This year, it conceded, “data with a high degree of granularity” was lacking, but noted that its “approach to reporting will evolve over time, as the regime matures”.
“We will consider our approach to the 2023 publication early next year, including whether it should include a list of all licensees who have reported to ASIC during the period. We will consult with stakeholders in advance of the commencement of more granular public reporting,” the corporate regulator said.
This year, ASIC kept the names and details of licensees out of the report as it felt that comparisons between licensees would be unlikely to provide “meaningful insights” given the current inconsistencies in reporting practices.
These inconsistencies, ASIC said, were mostly caused by “implementation challenges”.
“The scale of the changes and the principles-based nature of the regime have led to challenges in the implementation of the new regime,” the corporate regulator acknowledged.
The breach reporting regime was first introduced in October last year and instructs Australian Financial Services (AFS) licensees and credit licensees to submit notifications about “reportable situations” to ASIC within 30 calendar days.
But by August, the corporate regulator acknowledged concerns with the regime, with commissioner Sean Hughes conceding at the time the presence of implementation challenges.
“We are aware that the regime has led to a number of implementation challenges,” Mr Hughes said. “However, ASIC remains committed to the successful implementation of this regime, and we have developed a comprehensive plan of work to ensure that it meets its objectives for ASIC, industry, and consumers.”
ASIC’s first report, published last week, revealed that of the 8,829 reports submitted to the regulator in the nine-month period, only 878 were related to financial advice.
