by Dr. Andrew D. Schmulow
published electronically in The Sydney Morning Herald Online, 31 May 2016.
Recently, the federal government completed an inquiry into how we regulate the financial system. One of the inquiry’s proposals was that we need a board of oversight over ASIC – the consumer protection regulator – and APRA – the bank regulator.
That proposal was eventually dropped, doubtless with some push-back from the regulators. In fact, creating a Financial Regulator Assessment Board was the inquiry’s only recommendation that the Abbott government rejected.
Because of ASIC’s staggeringly poor performance, and all the recent banking and insurance scandals, there’s now a call for more than a board of oversight, there are calls for a royal commission. So that worked out well.
All the while a blowtorch has been held against ASIC, and for reasons that are both good, and that keep coming. But APRA has escaped scrutiny, when in fact it may be the unsung villain of the piece. Allow me to explain.
Also published in The Age and The Canberra Times Online.