Corporate cop aims at taking down greenwashing, predatory lending
Greenwashing, investment scams involving crypto and predatory lending would become a priority for the Australian Securities and Investments Commission next year.
ASIC's Sarah Court
It was the first time ASIC had identified its priority areas and its deputy chair Sarah Court said it was a signal to the community about its intent.
Its inclusion of greenwashing follows a wave of investment moving into exchange traded funds (ETF).
It said $128 billion had been invested in ETFs with an ESG (environmental, social, governance) focus while there had also been a 157 per cent increase in advisers who claimed to provide ESG advice.
ASIC said it would closely monitor for misleading conduct and claims of greenwashing that cannot be sustained.
Its definition of greenwashing is a practice that misrepresents the extent to which a product or investment strategy is environmentally friendly, sustainable or ethical.
It has five other “enduring priorities” which were misconduct the damaged the market’s integrity such as insider trading and market manipulation; misconduct affecting First Nations people; misconduct involving a high risk of significant consumer harm; systemic compliance failures by large organisations and new or emerging conduct risks.
ASIC said in the space of two years to June 2022, it received more than 2200 reports of misconduct involving crypto assets or crypto scams and so it had become one of its priorities.
“Australians have experienced a range of financial pressures in recent years, from the uncertainty of the Covid-19 pandemic to increased costs of living,” Court said.
“On top of this, many have been affected by investment scams.
“We are prioritising the disruption of scams, including working with other regulators, industry and social media platforms to reduce harm.”
Predatory lending was a priority because of the high level of ownership of credit cards in the community. ASIC believed that because of the current economic conditions there would be increasing demand for credit cards, personal loans and short-term credit arrangements.
ASIC also said there had been an increase in the number of property investment schemes that had collapsed and it would be prioritising enforcement action and holding individuals to account.
