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NEW PENALTIES FOR BANKING MISCONDUCT PASS SENATE AFTER LABOR BACK-FLIP

NEW PENALTIES FOR BANKING MISCONDUCT PASS SENATE AFTER LABOR BACK-FLIP

Criminal and civil penalties for corporate and financial sector misconduct are set to significantly increase, following a Labor Party back-flip and passage of legislation through the Senate. The legislation will now go to the House.

MEDIA RELEASE

The Hon Josh Frydenberg MP
Federal Member for Kooyong
Treasurer of Australia
Deputy Leader of the Liberal Party
THE HON JOSH FRYDENBERG MP
Treasurer

15 February 2019

The legislation builds on recommendations from the Australian Securities and Investments Commission (ASIC) Enforcement Review Taskforce which included Treasury, ASIC, the Attorney-General’s Department, the office of the Commonwealth Director of Public Prosecutions and an expert group drawn from a range of stakeholders including consumer groups and academia with expertise in corporations, consumer, financial and credit law.

After doing nothing for six years in government to better protect Australian consumers from corporate and financial sector misconduct, Labor suddenly – and without consultation – pulled another political stunt by seeking to uncap the maximum civil penalty for corporations.

Upon realising the recklessness of their idea this week, Labor back-flipped, shelving their plan.

With Labor having already delayed the passage of the legislation by almost three months, the Government has put the interests of Australian consumers first and supported the passage of this legislation in the Senate.

In relation to maximum criminal penalties:

OLD   NEW

Individuals   5 years imprisonment  and/or $42,000

 15 years imprisonment
and/or the greater of $945,000 or three times the benefit gained/loss avoided
 Corporations
 $210,000 The greater of $9.45 million
or three times the benefit gained/loss avoided or 10 per cent of annual turnover
 In relation to maximum civil penalties:  
 OLD  NEW
Individuals
$200,000
  The greater of $1.05 million
or three times the benefit gained/loss avoided
Corporations
$1 million
$10.5 million or three times the benefit gained/loss avoided or 10 per cent of annual turnover (capped at $525 million)


The increased penalties include increases to penalties that haven’t changed in more than twenty years. The range of contraventions subject to civil penalties will also now expand and the courts will be given the power to seek additional remedies to strip wrongdoers of profits illegally obtained or losses avoided.

A strong corporate and financial sector which is held to account is part of the Coalition Government’s plan for a stronger economy.

Ends

Last modified onFriday, 15 February 2019 20:25

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