ASIC has released an immunity policy for certain contraventions of the Corporations Act, which includes serious offences such as market manipulation, insider trading and dishonest conduct in the course of carrying on a financial services business.
Under the new policy, an individual who has engaged with others to manipulate the market, commit insider trading or engage in dishonest conduct when operating a financial services business (Part 7.10 of the Act) can, in certain circumstances, seek immunity from both civil penalty and criminal proceedings. Applications for immunity under ASIC’s policy are only available to individuals, not corporations.
The policy will assist ASIC in identifying and taking enforcement action against specific markets and financial services breaches of the law and strengthen ASIC’s enforcement toolkit.
ASIC is responsible for granting civil immunity, while the Commonwealth Director of Public Prosecution (CDPP) is responsible for granting criminal immunity. ASIC will work with and provide input to the CDPP on applications for criminal immunity.
An application for immunity can be made by:
- completing ASIC’s online form, or
- contacting the ASIC Immunity Policy Hotline on +612 9911 5008, or
- emailing ASIC at email@example.com.
Under the policy, immunity will only be available to the first individual who satisfies the immunity criteria and reports the misconduct to ASIC prior to commencement of an investigation into the conduct.
Individuals who do not meet the criteria for immunity are still encouraged to cooperate with ASIC and will be given due credit for any cooperation received (see INFO 172). ASIC will not provide immunity from any administrative or compensation actions. Any cooperation provided by an individual will be considered in determining whether to take administrative action against the individual.
ASIC Commissioner Sean Hughes said, ‘ASIC continues to develop and implement new tools to combat and detect misconduct. The Immunity Policy enhances ASIC’s ability to identify and take enforcement action against complex markets and financial services contraventions.’
ASIC will review its Immunity Policy at least every two years. A set of frequently asked questions on ASIC’s Immunity Policy is available on its website.
Individuals found to have contravened prohibitions in Part 7.10 of the Act can:
- face up to 15 years in prison, and
- be fined almost $1,000,000 or if the court can determine the benefit derived from the contravention, three times the benefit’s value.
© Australian Securities & Investments Commission. Reproduced with permission.