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ASIC to chase offenders for investigation costs

The Australian Securities and Investments Commission (ASIC) has taken a tougher approach to recovering its investigations costs from guilty parties.

ASIC has rarely used its power to recover expenses and costs for work that has led to successful prosecution or civil proceedings against a person.

“We have reviewed our approach and consider we should more frequently seek to recover the expenses and costs of an investigation from the person who has caused those expenses and costs to be incurred,” the regulator says in an information sheet issued last week.

Costs may include salaries, travel expenses and the fees of external legal counsel and experts.

ASIC may seek full or part payment.

It will not seek costs when the only basis for exercising its powers are interlocutory judgements or declarations given provisionally during a legal action, judgements that relate to preserving assets or travel restraint orders, or those made in proceedings that solely concern challenges to ASIC exercising its powers.

In deciding whether to pursue costs, consideration will be given to a target’s co-operation with the investigation, level of culpability, ability to pay and ASIC’s success in the proceedings.

Costs may be apportioned between multiple defendants. The penalty for not complying can be $8500, a year in jail, or both.