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Conducting investigations into allegations of regulatory breaches, fraud or corruption can present serious legal and commercial risk if privilege cannot be asserted over the findings of those investigations. That risk may be compounded if boards choose to conduct such investigations in-house, often with compliance managers or in-house counsel reporting the findings of those investigations directly to the board. Waiving or losing privilege can have serious consequences if any conclusions (or preliminary findings) about who is…
On 10 June 2015, the Australian Prudential Regulation Authority (APRA) released the final version of its Superannuation Prudential Practice Guide SPG 223 – Fraud Risk Management (SPG 223) following consultation with industry conducted in October 2014. As with other prudential practice guides released by APRA, SPG 223 is a non-binding document which sets out APRA’s view of sound practice in the area of fraud risk management. In particular, SPG 223 provides insight into the steps…
For the second time ever, the Australian Federal Police have laid bribery and corruption charges against directors of an Australian company. Unlike their regulator counterparts in the US and UK, the AFP have until now, been very reluctant to exercise their anti-bribery powers, but with a reported further 14 active foreign bribery investigations at the moment (only 9 of those publicly known), the time is ripe for our regulator to start flexing its powers against bribery…
As with the Murray Inquiry’s Interim Report, the Final Report highlights cyber security and technology related fraud risks as an emerging trend for the financial services industry that presents many challenges. At the forefront of the risks that arise is the rapid pace of technological change that is occurring within the financial system and how the system operates. As a result, the emergence of new technology is placing demands on regulators to be more flexible,…
On 5 November 2014 the High Court handed down its decision in Wellington Capital Limited v Australian Securities and Investments Commission [2014] HCA 43 concerning the in specie distribution of scheme property by a responsible entity.  However, the decision is applicable to trusts more generally. The key issue was whether, in the absence of a specific power dealing with in specie distributions, the responsible entity, Wellington Capital (Wellington), had the power to make them? The…
Incentivising whisteblowers could be an easy first step for the Australian Government if it were to heed the call by the recent Senate Economics References Committee for a more pro-active approach to fraud.  Currently, Australia has no incentivised whistleblower programs. The prospect of a reward for whistleblowers would see a sharp rise in the number of whistleblowers across a range of industries. If these laws come to pass, organisations will need to ensure that their…