ASIC grants immunity to whistleblowers who commit serious offenses

Rick Steves

The regulator has also clarified it will not provide immunity from any administrative or compensation actions. In the meantime, the US SEC announced it has awarded a total of $741 million to 136 whistleblowers since 2012.

ASIC has announced a new policy of immunity for serious offenses such as market manipulation, insider trading, and dishonest conduct.

The Australian Securities and Investments Commission pledges to offer individuals, not corporations, immunity from both civil penalty and criminal proceedings to anyone who has engaged with others to manipulate the market, commit insider trading or engage in dishonest conduct.

In exchange, whoever seeks immunity will be required to assist ASIC in identifying and taking enforcement action against the individuals and corporations who have breached the law.

While ASIC is only responsible for granting civil immunity, the Australian financial watchdog will work with the Commonwealth Director of Public Prosecution (CDPP) on applications for criminal immunity.

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.”

The regulator has also clarified it will not provide immunity from any administrative or compensation actions. According to Australian law, individuals who have committed serious offenses such as market manipulation, insider trading, and dishonest conduct face up to 15 years in prison, and can be fined almost $1,000,000 or three times the benefit’s value, if determined by the court.

In 2012, the United States Securities and Exchange Commission introduced a whistleblower rewards program which has awarded approximately $741 million to 136 individuals since issuing its first award, with all payments being made out of an investor protection fund established by Congress that is financed entirely through monetary sanctions paid to the SEC by securities law violators.

The SEC awards whistleblowers who voluntarily provide the SEC with original, timely, and credible information that leads to successful enforcement action. Awards range from 10 percent to 30 percent of the money collected when the monetary sanctions exceed $1 million. Whistleblowers remain anonymous as the SEC protects the confidentiality of their identity.

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