Regulatory Recap - December 2016

Recent Key Developments

  • Labor established a Senate inquiry to review the impact of misconduct in the banking and financial services sector
  • ASIC announced BMW Australia Finance Limited would implement Australia's largest consumer credit remediation program
  • Professor Ian Ramsay released his interim report on the review of the financial EDR framework, going against the Government's recommendation of a banking tribunal    

Australia

  • Labor established a Senate inquiry to review the impact of misconduct in the banking and financial services sector. The Senate Economics References Committee will review the regulatory framework for the protection of consumers, including small business, with particular reference to the following: the impact of misconduct in the sector on consumers, the impact of consumer outcomes on executive and non-executive remuneration, commission and fee structures, and the availability and adequacy of compensation and legal advice to victims of misconduct:  > read more
  • ASIC accepted an enforceable undertaking from BMW Australia Finance Limited, pursuant to which it will implement Australia's largest consumer credit remediation program to compensate customers for its responsible lending failures. It will provide consumers with over $72 million in redress in the form of remediation payments, loan write-offs and interest rate reductions on current contracts: > read more
  • Professor Ian Ramsay released his interim report on the review of the financial EDR framework, proposing two new ombudsman schemes: one for financial, credit and investment disputes and another for superannuation disputes. The report recommended the monetary limits and compensation caps for consumers and small business be increased and proposed enhanced accountability and oversight for the two new schemes. The final report will be delivered to the Government by the end of March 2017: > read more
  • Federal Government introduced client money reforms to protect retail investors, ensuring financial services firms can no longer use their retail clients' money for their own purposes: > read more
  • ASIC deputy commissioner, John Price, gave a speech outlining various proposals to help improve the position of whistleblowers: > read more
  • ACCC issued a draft determination to deny authorisation to CBA, Westpac, NAB and Bendigo and Adelaide Bank to collectively bargain with and boycott Apple on Apple Pay. ACCC stated its concerns that the conduct would reduce or distort competition between the banks individually negotiating with Apple and therefore reduce competition between the banks in the supply of mobile payment services for iPhones: > read more
  • ACCC lost its Federal Court proceedings against Woolworths Ltd in which it alleged Woolworths had engaged in misleading and deceptive conduct in demanding payment from a large number of its suppliers: > read more
  • Australian Law Reform Commission released its second discussion paper regarding elder abuse, which considers laws and frameworks to safeguard older persons from misuse or abuse by formal and informal carers and others. These include regulation of financial institutions and superannuation. The paper proposes a national online register of enduring powers of attorney and enduring guardianship documents. It also proposes amendments to the Code of Banking Practice to require banks to take reasonable steps to identify and help prevent the financial abuse of elders: > read more
  • ASIC released an overview of its decisions on relief applications for April to September 2016 showing in over 60% of cases ASIC approved applications for relief. The applications refused included an application for relief from the requirement to hold an AFS licence for the development and use of a digital advice tool: > read more
  • Federal Court fined construction company Hochtief AG $400,000 for insider trading, after it came into possession of information about the expected results of Leighton Holdings Limited shortly prior to Hochtief AG procuring the acquisition of shares in that company (via its Australian subsidiary): > read more
  • Treasury released a proposals paper on the design and distribution obligations and ASIC's product intervention power. This is in response to the recommendation from the Financial System Inquiry for new accountability obligations for entities that issue or distribute financial products and to strengthen consumer protection by introducing financial product intervention powers. The Government will undertake extensive consultation on the proposals: > read more
  • ASIC released class waivers to allow eligible financial technology businesses to test certain specified services without holding an Australian financial services or credit licence: > read more
  • ASIC reported on corporate insolvencies for the 2015-2016 financial year:  > read more​​

International

United Kingdom

  • FCA issued a consultation paper on broadening the £3.5 billion Financial Services Compensation Scheme, including extending compensation limits for pension products beyond the current £50,000 up to £1 million and making retail product providers cover the cost of failed intermediary firms. The FCA also sought views on making the riskiest financial services companies (in terms of their product offering or business model) pay more towards compensation: > read more
  • FCA issued a report on early arrears management in unsecured lending, finding that the majority of firms missed early opportunities to identify and offer appropriate forbearance to customers who were showing signs of financial difficulty: > read more

    United States

  • CFPB released its FY2016 annual report, highlighting its internal engagement and outreach initiatives: > read more
  • Yahoo disclosed a security attack in 2013 had compromised more than 1 billion user accounts. Together with its disclosure in September that 500 million accounts had been hacked in 2014, these are the largest known security breaches of one company's computer network: > read more
  • Deutsche Bank settled charges it misled clients about the performance of a core feature of its automated order router that primarily sent client orders to dark pools, agreeing to admit wrongdoing and pay US$18.5 million penalties to the SEC and New York Attorney General's office: > read more

Our Regulatory Risk + Strategy Team​

Scott Atkins

I'm unapologetically determined and fearless. I pursue excellence. Always.

Scott Atkins Partner

Scott is the Chair of our Board and an internationally renowned insolvency and restructuring lawyer. He is an inaugural Fellow and a member of the Board of INSOL International. Scott is also Vice President of the Australian Restructuring Insolvency and Turnaround Association (ARITA).

Scott is a trusted adviser to Australia's leading banks and insolvency and restructuring practitioners and has acted on some of the industry's most complex and sensitive banking and insolvency advisory and dispute resolution matters.

Prior to joining HDY, Scott practiced for 7 years as in-house counsel with Commonwealth Bank Group. He is now our Client Relationship Partner for the CBA Group. He is also the co-leader of our cross-border insolvency practice and our regulatory enforcement practice. Scott is recognised by his peers for his leading expertise in cross-border insolvency, acting on both inbound engagements in Australia and advising Australian clients on outbound engagements in the USA, UK, Cayman Islands, Hong Kong and The Netherlands, among other jurisdictions.

Scott was the Australian delegate on the Advisory Committee on Comparative Law established by the American Bankruptcy Institute as part of its Commission to Study the Reform of Chapter 11 of the US Bankruptcy Code. This resulted in a landmark report for the reform of Chapter 11.

He is a published author on insolvency and cross-border insolvency. Most recently, Scott was one of the Australian contributors to the 2015 publication 'International Contributions to the reform of Chapter 11 U.S. bankruptcy code' which is volume 2 of the European and International Insolvency Law Studies series. He also authored the Australian chapter of Avoidance of Antecedent Transactions and Cross-Border Insolvency (INSOL International). Among other publications, he is the co-author, together with Professor Rosalind Mason, of the Australian chapter of Look Chan Ho's leading text: Cross-Border Insolvency: Cases and Materials (Kluwer International).

Scott is a visiting lecturer on cross-border insolvency at the University of Sydney in its undergraduate and postgraduate law programs lead by Professor John Stumbles.

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Nikki Bentley

I understand the financial services industry and thrive on helping our clients in this industry succeed.

Nikki Bentley Partner

Nikki is the Group Leader of Henry Davis York's Corporate Group, which includes the legal teams for Corporate / Mergers & Acquisitions; Investments & Financial Services and Tax.

Nikki is a leading investment funds advisor specialising in financial services and corporate law.  She specialises in business establishment and structuring, fund establishment, funds merger and acquisition, product disclosure and distribution. Nikki leads HDY's corporate group which combines expertise from the Financial Services, M&A and Tax areas.

Nikki provides advice to leading Australian and global fund managers on a full range of corporate, commercial and regulatory issues facing their businesses. She has considerable experience in assisting clients with fund establishment (onshore and offshore), disclosure and distribution. Nikki regularly advises clients on establishing, buying, selling and restructuring their businesses. She also regularly assists clients responding to regulatory enquiries and investigations.

With more than 15 years funds management experience in private practice, government and as an in-house lawyer, Nikki's practice spans the range of funds management products, with particular expertise in hedge funds, property funds and equities.

Nikki is regularly involved in industry and government discussions on regulatory reforms impacting the Australian funds management industry. Nikki is a passionate advocate for the development of a new corporate collective investment vehicle because of the opportunities it could provide to grow the funds management industry. She is the Honorary Legal Counsel and Chair of the Regulatory Committee for the Australian branch of the Alternative Investment Management Association (AIMA) and is a regular participant on the Financial Services Council (FSC) working groups.

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John Martin Partner

John is a leading lawyer in both financial sector dispute resolution (complex and regulatory) and corporate insolvency and restructuring, with a particular specialty in cross-border insolvencies. He is recognised by his clients, peers and legal directories as a leader in his field.
 

Domestically, John advises on large and complex insolvencies and assists in finding solutions for financial institutions with regulatory and other complex issues. His clients include several of Australia's major banks, as well as insolvency practitioners appointed to insolvent entities.

Internationally, John has advised in connection with insolvencies in England, Fiji, Bermuda, Cambodia, Cayman Islands, Brunei, and Norfolk Island. His cross-border experience includes acting for the liquidators of an insolvent bank, and various liquidators of insurance and reinsurance companies.

John is a recognised authority on insolvency issues, with articles published in media outlets such as The Australian Financial Review and the Insolvency Law Journal. He has presented at numerous domestic conferences as well as internationally in the US, England, South Africa, Singapore, Canada, New Zealand, and the Netherlands.

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Kathy Merrick

Having the trust of my clients means we work together to achieve the best outcome.

Kathy Merrick Partner

Kathy specialises in corporate insolvency, general commercial litigation and dispute resolution and has advised on many of Australia's biggest corporate disputes, collapses and investigations.

Kathy has been called upon to advise on many of Australia's major corporate disputes, collapses and investigations. Her clients include major corporations and financial institutions, directors, officers, accounting and professional services firms, administrators, liquidators, other corporate entities and individuals.

Kathy has extensive experience in the areas of insolvency, directors and officers duties, professional negligence claims, and regulatory and other investigations, representing parties whether as plaintiffs, defendants, investigators or the subject of investigation.

Kathy is a strong advocate for pro bono work and has played a lead role in developing our community and pro bono program.

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Anna Simmons

I deeply understand my client's business so I can offer insight and innovative solutions to achieve outcomes that count.

Anna Simmons Senior Associate

Anna is a restructuring and insolvency lawyer specialising in insolvency advice, dispute resolution and financial regulation.

Anna's clients include banks and insolvency practitioners. She advises these clients on dispute resolution, regulatory compliance, enforcement strategies, receiverships, and liquidations.

Anna has extensive experience in advising on various aspects of debt recovery, insolvency and bankruptcy, creditors' remedies, general banking litigation, fraud disputes, misleading and deceptive conduct claims (including valuer negligence) and other forms of dispute resolution. She has worked on a large-scale remediation program, with a focus on regulator engagement.

Anna also presents and writes on insolvency, litigation and recovery matters.

As part of HDY's Pro Bono program, Anna volunteers at Redfern Legal Centre and MOSAIC, a specialist legal service that provides free legal advice to asylum seekers, refugees and newly arrived migrants. Anna is a member of HDYPride, the firm's LGBTIQ support network.

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Claudine Salameh Partner

Claudine has over 15 years' experience dealing with legal issues in the financial services sector.

She is a banking and insolvency litigator and regulatory expert. She acts for the major Australian financial institutions in matters involving customer disputes and litigation, fraud, regulatory and compliance issues, regulatory investigations, inquiries and enforcement matters, security enforcement and insolvency litigation. She also acts for insolvency practitioners in formal receiverships, voluntary administrations and liquidations.

Claudine is well known for her ability to manage risks posed by litigation and regulatory inquiries and investigations. She is particularly attuned to reputational and business risks. She is highly strategic and creative and is recognised by her clients for being able to achieve the perfect balance between legal arguments and commercial and practical outcomes.

Claudine has been instrumental in working with clients to provide insights into the field of behavioural economics, which over the past few years, has been of interest to policy makers and regulators as a tool to engage in 'choice architecture'. On a practical level, Claudine has worked closely with clients to design approaches to customer engagement that make use of behavioural insights.   

Claudine is an expert in the conduct of review and remediation programs and provided assistance to the regulator, by way of submissions and her involvement in an industry working group, on ASIC's regulatory guide on review and remediation programs.

Claudine is very familiar with ASIC's powers to obtain documents and information from financial institutions and is called upon by financial institutions to provide assistance in these matters. She has a style that is conducive to having a fruitful dialogue with both the regulator and the various stakeholders within a financial institution.

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