How Can Corporate Lawyers Help You Through ASIC Investigations?

February 14, 2024    Corporate Lawyers Perth WA
How Can Corporate Lawyers Help You Through ASIC Investigations?

Most businesses strive to maintain ethicality and legal conduct in their administration and proceedings. They opt to resolve conflict within the company as closely as possible to prevent the involvement of external agencies. However, in case of severe lapses in a business’ conduct and ethics, the Australian Securities and Investment Commission, abbreviated as the ASIC, oversees its investigations.

ASIC investigations are serious, and non-cooperation can be a criminal offense. That’s why if your company has been served a notice under the Australian Security and Investment Commissions Act, Section 19, seeking legal help is paramount.

What is the role of the Australian Securities and Investment Commission?

Before understanding how these investigations go, knowing what is ASIC is necessary. ASIC is the regulatory institution that monitors Australia’s corporate, financial and market services. In other words, this institution is responsible for maintaining ethical conduct and standards in any business operating in Australia. It maintains a record or register of the financial services licensees in Australia and other authorized representatives.

ASIC investigations are not a trifling matter as they are entitled to detect and disrupt unlawful business conduct.

How do ASIC investigations work?

For the ASIC to be involved, there must be an indication of unlawful or unethical conduct from a business. Generally, this starts with a complaint being lodged against misconduct from the business. This complaint to the ASIC can be lodged by:

  1. A client, customer or member of the public who is largely dissatisfied by the company’s proceedings or handling of their business or a specific matter
  2. A referral from other regulatory agencies or government agencies
  3. Auditors, licensees, and insolvency practitioners who are submitting regular audits and reports of the business to the ASIC.

After the complaint has been received by the ASIC, whether or not there is a need for investigation is determined by the following clauses:

  • The gravity or extent of the harm caused or disseminated
  • The type of misconduct and unlawful activity alleged through the complaint and the presence of evidence to support it.
  • The benefit of investigating and pursuing the alleged misconduct
  • Any alternatives to the investigation
  • Whether or not the alleged misconduct reflects a widespread concern or any trend that may be growing
  • If the alleged misconduct impacts the integrity of the market, consumer security and investors’ confidence.

What goes on during an ASIC investigation?

The ASIC has vested powers to demand evidence and closely inspect the business, which includes questioning the company director, employees and lawyers. The company can be asked to produce otherwise confidential documents during the investigation.

What should you do in case of an ASIC investigation?

One of the first and foremost actions to be taken during an ASIC investigation is to seek the representation of a corporate lawyer or law firm. It’s extremely important to discuss with your layers what a company director, employees, and people involved in the investigation can and cannot do.

Under Section 19 of the Australian Security and Investment Commissions Act, the ASIC can request documents and question employees and company directors. However, there might be some documents protected by professional legal privilege which they may not be able to ask you to produce legally. Talking to the best ASIC and ASX Investigations lawyers in Perth can help you figure out information like this.

What preventive measures can you take?

When it comes to business and ASIC investigations, pre-emptive action can be extremely important. Talking to experienced corporate lawyers, reviewing your current documents, maintaining strict due diligence, and assessing risks can greatly help prevent loopholes and chances of misconduct.

This includes forming proactive, functional and all-purpose governance, compliance and risk management processes within the organization. These approaches can prove your proactive approach and attempt at effective lawful maintenance and compliance if an ASIC investigation arises.

Summing up

ASIC investigations are extremely serious and can indicate severe or even criminal offences on the part of the company or business. That’s why seeking the help of a corporate lawyer can help prevent situations like this.

Should an investigation ever arise, corporate lawyers can help you navigate the investigations and protect your rights and interest in the process if you are faced with incrimination. Get in touch with the best corporate lawyers in Perth for consultation today.

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