Friday, 14 August 2015

Shrinking insolvency division no threat to supervision: ASIC

Ex-ASIC insolvency team
member John Laird  
THE corporate regulator has rejected suggestions that its capacity to police the insolvency profession is diminishing, despite the departure of two senior insolvency team members in recent months and an almost 20 per cent reduction in insolvency division staff since 2011.

Neither John Laird or Marc Robinson would comment on their departures from the Australian Securities and Investments Commission's (ASIC) insolvency unit when contacted this week. Laird invoked confidentiality constraints. Robinson did not respond to a request for comment.

Sources told SiN that Laird, who according to his Linked In profile led the unit's investigations on major corporate collapses, is setting up his own consultancy.

Robinson, a senior insolvency specialist, is said to be headed to the Australian Tax Office (ATO) to work as a law interpretation specialist on its cross-agency task force combatting illegal phoenix activity.

If the most recent figures are accurate, the departures of Robinson and Laird leave ASIC with 21 insolvency team members monitoring almost 700 registered liquidators. That's about 33 liquidators per staffer and is representative of a trend of declining staff numbers within the division charged with the supervision of registered insolvency practitioners.

ASIC's 2010/11 annual report stated that there were 28 insolvency division staff regulating 670 registered liquidators. In 2011/12, staff numbers were reported as 24. Liquidator numbers meanwhile had risen to 680.

The following year ASIC reported that its insolvency team comprised 23.5 staff. Registered liquidator numbers had risen to 685. By 2013/14, the team had dispensed with the half staffer, leaving 23 staff to regulate a registered liquidator population of 696.

Heading to the ATO: Marc Robinson
ASIC cautioned against concluding that declining insolvency team numbers undermined its capacity to supervise liquidators, who are classified as a "regulated population".

"ASIC draws resources across the agency as part of its ongoing work regarding registered liquidator supervision, including from Enforcement teams, misconduct and breach reporting and the chief legal office," ASIC said in a statement.

"Like all organisations, ASIC must adapt to budgetary changes. Recent changes also reflect a need to ensure the right staffing structure to ensure delivery of our programs aimed at supervising the industry, engaging with the profession and enforcing the law where appropriate."

An ASIC spokesman also pointed out that the regulator has: ". . maintained its strong enforcement focus on registered liquidators (commencing 14 formal investigations in 2014 compared to 11 in 2013 and 13 in 2012) and, achieving the key enforcement outcome."

ASIC's annual report for 2014/15 - which will reveal whether the gap between insolvency staff numbers and the number of registered liquidators has widened further - is due for release in late October.

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