Public fires double-barrel blast at financial corruption

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Lead Editorial

2 November 2022
Vol. 24 No. 44

The Citizens Party’s motto is “citizens taking responsibility” for good reason: government of the people, by the people and for the people cannot work unless “the people” are engaged in the process. That has been amply demonstrated by the issue of financial corruption coming out of the 2018 banking royal commission.

The two major political parties initially promised strong action against the banks, but under pressure—as well as the influence of multi-million dollar donations (p. 3)—from the banks, they have both abandoned their promises.

Committed citizens, however, including financial victims and the Citizens Party, have not dropped the issue, and have continued to inform the public and press the politicians to do their job (see the ACP’s various efforts on p. 4).

That continual engagement led to a spectacular, unpredictable breakthrough in Parliament last week, sparked by independent economist John Adams’ report on the Australian Securities and Investments Commission’s (ASIC) abysmally low rate of investigations from the complaints it receives— just 0.79 per cent!

As the AAS has previously reported, the Adams Report highlighted a similar problem to that raised by the Banking and Finance Consumers Support Association’s Denise Brailey in 2007, who sounded the alarm about ASIC’s very low rate of prosecutions compared to complaints; Denise Brailey’s campaign helped to force the political scrutiny on the banks and regulators that ultimately led to the banking royal commission.

John Adams, however, informed by his own experience of the difficulty of getting ASIC to investigate a complaint, was able to show in his explosive report that ASIC’s performance hasn’t improved since the royal commission—it’s worse!

In the wake of the royal commission, and last year’s Senate inquiry into the Sterling First collapse that the ACP helped to establish, the Adams Report hit the political bullseye and could not be ignored.

Unexpectedly, a Liberal Senator, Andrew Bragg, with a background in the financial sector, picked up the Adams Report and called for an inquiry.

On the other hand, Labor Senators who had actively worked to hold ASIC accountable while in Opposition and initially welcomed the Adams report, backtracked on supporting an inquiry under pressure from Financial Services Minister Stephen Jones (see “What do bankers get for $22.6 million?”, p. 3). They retreated to insisting that instead of a standalone inquiry, the Labor-chaired Parliamentary Joint Committee on Corporations and Financial Services (PJCCFS) should just question ASIC in its regular oversight hearings. The problem with that approach is it wouldn’t allow victims to have their say through submissions that expose cases of ASIC’s failures.

At the start of last week, Senator Bragg gave notice that on the Thursday he would move a motion to establish a major Senate inquiry into ASIC, with specific terms of reference stipulating an 18-month inquiry.

The ACP collaborated with John Adams and Martin North of Digital Finance Analytics, in mobilising people to phone Senators to demand they back a proper inquiry, resulting in a flood of calls to their offices; one Senator’s aide noted, “There’s no one like the Citizens Party to melt the phones down!”

It all came to a head on Thursday morning: at 8:00 AM Labor Senator Deb O’Neill convened a meeting of her committee to pre-empt Senator Bragg’s inquiry, by getting her committee to establish its own standalone inquiry into ASIC that Labor would control, on almost identical terms of reference to Bragg’s!

However, instead of dropping his motion, Bragg went ahead and with the support of the Greens it passed, approving a parallel Senate Economics References Committee inquiry into ASIC.

Now, extraordinarily, we have two major inquiries, not just one! Even better, as one is chaired by Labor and one by a Liberal, they will have to compete, which means there is a greater chance of these inquiries exposing the truth rather than covering it up—a double-barrelled blast!

Only citizens taking responsibility—Adams writing his report, people making calls, etc.—achieved this outcome. Keep doing it.

In this issue:

• What do bankers get for $22.6 million? Liberal and Labor protection from accountability
• The ACP’s work developing a platform for economic recovery
• Open letter to the Attorney General, Mark Dreyfus
• Energy fight heats up as states put Albanese on the spot
• The roots of the Taiwan conflict - Part One: Origins of the Kuomintang
• Reflections on 30th anniversary of ACP national office

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