Australian Securities and Investments Commission (ASIC) outgoing chair Joe Longo told a parliamentary oversight committee that the regulator’s enforcement reserve is nearly depleted, raising questions about its capacity to pursue major cases in the year ahead.
Joe Longo stepped before the Parliamentary Joint Committee on Corporations and Financial Services on May 29 for the last time as ASIC chair, marking the end of a tenure that began in 2021. Accompanying him were deputy chair Sarah Court, who will take over the role, along with commissioners Alan Kirkland, Kate O’Rourke, and Simone Constant, CEO Scott Gregson, and executive director for enforcement and compliance Chris Savundra.
Over the past five years, ASIC more than doubled the number of formal investigations conducted annually and quadrupled the value of penalties obtained. The regulator has secured approximately $484 million in penalties in the current financial year alone, not including amounts still awaiting court approval. Among the actions cited were $250 million in combined civil penalties against ANZ, a $26 million fine against Westpac related to hardship failures, and proceedings against the ASX over governance and operational shortcomings. These outcomes reflect the kind of regulatory environment in which financial services firms now operate – one where ASIC has demonstrated both a willingness and a capacity to pursue large institutions through the courts.
The most consequential disclosure from the May 29 hearing concerned the state of the Enforcement Special Account (ESA), a dedicated fund that gives ASIC the financial runway to take on complex, costly litigation. Longo told the committee the account is on track to fall to its minimum viable level by June 30, 2026. “Absent replenishment, this will impede ASIC’s ability to maintain its current enforcement program,” Longo said, noting that discussions with Treasury and the government are underway. The account was designed to absorb the costs of large-scale matters – the kind involving multiple defendants, prolonged court proceedings, or the risk of adverse cost orders. Without additional funding, ASIC may have to scale back or defer cases that would otherwise proceed.
Longo also pointed to a structural bottleneck in the broader enforcement system. The Commonwealth Director of Public Prosecution (DPP), which assesses and acts on criminal referrals from ASIC, has not seen its resourcing grow in step with the volume of matters being referred to it. As other federal law enforcement agencies also draw on the DPP’s capacity, ASIC’s criminal matters face longer queues. This constraint sits alongside the Federal Court’s recently expanded criminal jurisdiction, which Longo supported but noted requires corresponding resources to be effective. Regulatory action in areas such as claims handling conduct, product disclosure failures, and customer hardship arrangements depends in part on ASIC’s capacity to investigate and litigate. A constrained enforcement budget could affect the pace of such action across the sector.
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Longo used the hearing to argue that litigation, while central to the regulator’s toolkit, has inherent limits. Court proceedings are retrospective by nature and cannot address forward-looking policy questions around productivity, financial literacy, or the governance of emerging technologies. “With a remit spanning millions of entities and individuals, ASIC faces a stark reality: we cannot litigate our way out of every problem,” he said.
Longo pointed to work on climate disclosure frameworks, digital assets regulation, and a roadmap for public and private markets as areas where the regulator has pursued change through means other than enforcement. He also argued that compliance costs across the financial system have grown to levels that warrant a policy response and suggested that a revived version of the Corporations and Markets Advisory Committee – abolished after its funding was cut in 2014 – could provide a structured mechanism for industry, government, and academics to work through reform.
Longo told the committee that remaining current with technological change is not optional for a financial regulator. He framed the risk of falling behind in artificial intelligence and data capabilities as a threat to the regulator's relevance. “If we do not remain institutionally engaged and curious about emerging technologies and innovation, it will be an existential risk to ASIC’s effectiveness and credibility as a regulator,” he said.
ASIC is running a pilot program using advanced supercomputing infrastructure through a partnership with the University of Technology Sydney’s Human Technology Institute and the Pawsey Supercomputing Research Centre in Perth. The aim is to test whether predictive, probabilistic methods can identify conduct risks earlier and allow for more targeted supervision. A government commitment of $97.3 million has also been made to modernise ASIC’s registry systems through the RegistryConnect Tranche 2 program.
Two ASIC publications released around the time of the committee hearing reflect the broader regulatory environment Longo described. At the RIAA Conference Australia 2026 in Melbourne on May 27, Commissioner O’Rourke discussed the regulator’s review of the first round of mandatory sustainability reports lodged under the Corporations Act 2001. She told attendees that while the initial reports showed improvement over earlier voluntary disclosures, the current standard should not become a ceiling for future reporting. “We don't want the baseline to become the benchmark,” she said.
Separately, ASIC’s Reporting and Audit Update published May 29 confirmed enforcement action for late financial report lodgements, with infringement notices of $792,000 issued to four Canva Group entities and $594,000 to three Mecca group companies. Commissioner O’Rourke said the regulator is conducting targeted, data-driven surveillance to identify non-lodgement and persistent late lodgement – obligations that apply to large insurers under the Corporations Act.
The developments reinforce the picture Longo drew at the committee: a regulator that has sharpened its enforcement record but is heading into a resource-constrained period while facing mounting demands from technological change, regulatory complexity, and an expanding compliance agenda.
