Australian regulators weekly wrap — Monday, 7 September 2020

Keeping on top of the latest financial services regulatory & compliance trends?

Investing time in your professional development within a rapidly changing financial services industry is challenging. To meet that challenge, the Australian regulators weekly wrap is designed to keep you at forefront of your practice by quickly setting out the top 5 developments from the past week, analysis and practical considerations for the future.

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  1. Corporate Criminal Liability Review (ALRC): following the Hayne Royal Commission , there were increased concerns that corporations, and senior officers within those corporations, were not being adequately held to account for serious corporate misconduct. (Criminal liability for corporations has always been a fraught subject, with the law a patchwork across Australia.) On 10 April 2019, the Federal AG provided Terms of Reference to the ALRC for an inquiry into Australia’s corporate criminal responsibility regime. The report, Corporate Criminal Responsibility (Report 136, 2020) was tabled in Parliament on 31 August 2020. You can read a summary here (my top read for the week!). There is a lot to take in from the report, however, the key points include: a) trivial misconduct will be decriminalised; b) attribution laws i.e. how criminal responsibility is attributed to corporations are to be harmonised; c) there will be a defense of ‘reasonable precautions’ where the corporation took reasonable steps to avoid the misconduct; d) there will be a new offence for where a corporation engages in systemic and repeated instance of misconduct. It focuses on whether the corporation allowed the problematic system of conduct to continue; e) there will be an extension of ‘failure to prevent’ corporate criminal to overseas offences e.g. foreign bribery; f) there will be an extension of the sentencing toolkit; g) deferred prosecution agreements should (finally!) be introduced. DPAs are basically negotiated criminal outcomes with corporations, much like the US system favours and recently the UK; and, h) individual liability liability for corporate criminal conduct…. should be pushed down the road for 5 years. The last is particularly important, as the initial thought bubble of using FAR / BEAR (or something still vaguer), to transpose corporate criminal liability onto individuals i.e. for not preventing a crime was and remains a very bad idea for its arbitrariness. A battle for 2025…

Thought for the future: AUSTRAC has released an information sheet which provides detailed information about AUSTRAC’s expectations for businesses when assessing and managing AML / TF risks. You can access it here. Now, with the rise and rise of regulatory expectations, and with the enforcement stakes being raised, more than ever the release of useful information such as this is needed.

(These views are my own and do not constitute legal advice. These updates are not designed to be comprehensive. Photo credit Tom Wheatley)

AU financial services lawyer in compliance, regulatory & disputes. Email sign-up: and LinkedIn: