ASIC has released details of its enforcement priorities for 2023 which signals where it will be directing its resources and expertise for the year. This is in addition to its enduring priorities which remain unchanged from year to year and customarily consist of protecting market integrity, preventing consumer harm, and identifying new and emerging conduct risks.

In what is perhaps a case of shutting the stable door after the horse has bolted, one of ASIC’s enforcement priorities for 2023 will be to stamp out misconduct involving high-risk products including crypto-assets. This is no doubt in response to its perceived lack of action in the collapse of FTX, then one of the largest cryptocurrency platforms in the world. ASIC notes that it is already active in the field with an interim stop order to prevent a company from offering or distributing funds to retail investors, and the commencement of civil penalty proceedings against another company for providing unlicensed financial services in relation to a crypto-asset.

Another regular feature on top priorities for ASIC is combating and disrupting investment scams by working with other regulators such as the ACCC, industry, and social media platforms to reduce consumer harm. It notes that it will continue publishing scam alerts and guidance in the event of data-breaches to keep Australians informed. In addition ASIC refers to guidance it published in late 2022 on ways to spot a scam, including those offering “guaranteed returns” and where you need to pay more to access your money.

A new entrant in ASIC’s 2023 priority list is the focus on misconduct that involves misinformation through social media about investment products (ie “finfluencer” conduct). This has a much narrower focus than the ACCC crackdown on influencers which commenced in January 2023 and involves identifying general misleading testimonials and endorsements by social media influencers. ASIC notes that it monitors select online financial discussions by influencers who feature or promote financial products for misleading or deceptive representations or unlicensed financial services. 

“Finfluencers” are able to share factual information that describes the features of terms and conditions of a financial product (or a class of financial products) but must do so without an opinion which is intended to influence, or which could reasonably be regarded as being intended to influence, a person making a decision in relation to financial products. Otherwise, the law could be breached by providing unlicensed financial product advice.

ASIC notes that influencers who receive benefits or payment for comments in relation to financial products are more likely to be considered to be providing financial product advice because it indicates an intention to influence. The Corporations Act imposes significant penalties including up to 5 years imprisonment for an individual and financial penalties of millions of dollars for a corporation. In addition, the law also prohibits conduct that is misleading or deceptive or likely to mislead or deceive, in relation to financial products and services, so influencers need to ensure that all content published is accurate and balanced.