Compliance review 2017

Compliance activity in 2017 was driven by 2 factors: firstly, new laws by Parliament which implemented review recommendations and secondly, increased enforcement activity by regulators.

Broadly this activity was directed at improving corporate culture but other changes reflected specific issues such as cybersecurity, prudential soundness, consumer protection, responsible lending and changes in technology.

To a certain extent changes were driven by the Government’s desire (ultimately unsuccessful) to avoid a royal commission into banking but several changes were the result of considered reviews such as the Murray Inquiry into financial services and the Ramsay competition policy review.

The Treasurer has published a list of changes relating to his portfolio which reflect activity in the sector.


Enforcement

All the regulators were active enforcers in 2017 but Austrac’s actions against TAB and CBA represented a change in its approach and are likely to have a significant ongoing impact regarding AML/CTF compliance.

ASIC has been criticised for its performance but it has taken a high profile in respect of responsible lending (eg Channic), misleading financial services advertising and corporate culture generally. Its BBSW cases against Westpac, ANZ and NAB illustrate ASIC’s tenacity once it has decided to prosecute.

And APRA has been active prudentially with respect to housing loans and will be given greater powers under the Banking Executive Accountability Regime.

What you need to do

Businesses will need to provide more resources for their legal and compliance teams to monitor increased regulation and internal compliance; but at the same time compliance officers need to work more efficiently and collaboratively with business units.

2018 will start with ensuring compliance for the Data Breach Notification Scheme.

Case notes

2017 timeline

2018 timeline

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