• Fri. May 24th, 2024

ASIC Eyes AI to Shield Australians from Financial Scams

Artificial
intelligence (AI) may soon assist financial regulators in combating criminals. The
Australian Securities and Investments Commission (ASIC) has announced plans to
escalate its enforcement activities aimed at protecting consumers and small
businesses. This comes in response to a growing prevalence of scams, digitally-enabled
misconduct, and predatory lending practices in Australia. In addition, the
regulatory body has presented a new Corporate Plan.

ASIC’s Chairman, Joe Longo unveiled the organization’s latest Corporate Plan, emphasizing that
the past year has been one of progress against strategic priorities.

“We
have made significant strides since the release of our strategic priorities
last year, but there is still more work ahead,” Longo commented. The plan
focuses on key trends and emerging issues in the regulatory landscape, including
shifts in sustainable finance, the digital and data economy, and the challenges
posed by an ageing population.

ASIC ‘s core
priorities in the newest four-year plan include:

  • Strengthening
    enforcement actions
  • Monitoring
    critical trends in sustainable finance and the digital economy
  • Streamlining
    decision-making and operational processes

Source: ASIC

ASIC has a
track record of robust enforcement actions. Over the past three years leading
up to June 2023, the agency initiated more than 125 criminal actions, resulting
in 92 criminal convictions and 39 custodial sentences.

Additionally,
nearly 200 civil actions were commenced, leading to over 130 successful civil
claims. Courts have also imposed more than $500 million in criminal and civil
penalties during this period.

AI to Help

Longo highlighted the organization’s interest in developing and applying artificial intelligence.

“We
are closely monitoring how artificial intelligence impacts the businesses and
markets we regulate, and we are exploring its potential uses within ASIC,”
Longo added.

The new
organizational structure, implemented in July, aims to enhance ASIC’s ability
to respond to emerging threats and challenges. A key focus is to streamline
decision-making processes and increase operational flexibility.

“Protecting
consumers and small businesses from misconduct is central to our work,”
Longo concluded. “Our actions are designed to maintain confidence in
Australia’s markets and support the economy.”

The growing
issue of investment fraud in Australia, which is draining over $1 billion from
its citizens annually, has prompted the formation of the first fusion cell by
the National Anti-Scam Centre. The Australian Competition and Consumer Commission (ACCC) and the Australian Securities and Investments Commission (ASIC) will co-manage this new effort.

Important Regulatory
Updates

Two weeks ago, foreign financial services providers (FFSPs) were granted an extension for the transitional relief period. Initially expected to expire in March
2024, the new deadline has been moved to March 31, 2025. This gives these
organizations additional time to acquire an Australian financial services (AFS)
license for their dealings with wholesale clients in Australia.

Simultaneously, the market oversight body issued a new report focusing on optimal practices for whistleblowers. The aim is to motivate individuals to reveal
vital information that could assist in detecting illegal activities in the
financial markets.

Artificial
intelligence (AI) may soon assist financial regulators in combating criminals. The
Australian Securities and Investments Commission (ASIC) has announced plans to
escalate its enforcement activities aimed at protecting consumers and small
businesses. This comes in response to a growing prevalence of scams, digitally-enabled
misconduct, and predatory lending practices in Australia. In addition, the
regulatory body has presented a new Corporate Plan.

ASIC’s Chairman, Joe Longo unveiled the organization’s latest Corporate Plan, emphasizing that
the past year has been one of progress against strategic priorities.

“We
have made significant strides since the release of our strategic priorities
last year, but there is still more work ahead,” Longo commented. The plan
focuses on key trends and emerging issues in the regulatory landscape, including
shifts in sustainable finance, the digital and data economy, and the challenges
posed by an ageing population.

ASIC ‘s core
priorities in the newest four-year plan include:

  • Strengthening
    enforcement actions
  • Monitoring
    critical trends in sustainable finance and the digital economy
  • Streamlining
    decision-making and operational processes

Source: ASIC

ASIC has a
track record of robust enforcement actions. Over the past three years leading
up to June 2023, the agency initiated more than 125 criminal actions, resulting
in 92 criminal convictions and 39 custodial sentences.

Additionally,
nearly 200 civil actions were commenced, leading to over 130 successful civil
claims. Courts have also imposed more than $500 million in criminal and civil
penalties during this period.

AI to Help

Longo highlighted the organization’s interest in developing and applying artificial intelligence.

“We
are closely monitoring how artificial intelligence impacts the businesses and
markets we regulate, and we are exploring its potential uses within ASIC,”
Longo added.

The new
organizational structure, implemented in July, aims to enhance ASIC’s ability
to respond to emerging threats and challenges. A key focus is to streamline
decision-making processes and increase operational flexibility.

“Protecting
consumers and small businesses from misconduct is central to our work,”
Longo concluded. “Our actions are designed to maintain confidence in
Australia’s markets and support the economy.”

The growing
issue of investment fraud in Australia, which is draining over $1 billion from
its citizens annually, has prompted the formation of the first fusion cell by
the National Anti-Scam Centre. The Australian Competition and Consumer Commission (ACCC) and the Australian Securities and Investments Commission (ASIC) will co-manage this new effort.

Important Regulatory
Updates

Two weeks ago, foreign financial services providers (FFSPs) were granted an extension for the transitional relief period. Initially expected to expire in March
2024, the new deadline has been moved to March 31, 2025. This gives these
organizations additional time to acquire an Australian financial services (AFS)
license for their dealings with wholesale clients in Australia.

Simultaneously, the market oversight body issued a new report focusing on optimal practices for whistleblowers. The aim is to motivate individuals to reveal
vital information that could assist in detecting illegal activities in the
financial markets.

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By admin