This article is prepared for General Counsel (GC) to provide practical guidance on how to prepare for, respond to, and manage an ASIC investigation.
GC can use this guide to manage ASIC investigations across four stages: prevention, immediate response, document handling, and post-investigation remediation.
Understanding ASIC’s Regulatory Landscape in Australia
ASIC is an independent Australian statutory authority with broad oversight of corporations, financial markets, financial services, and consumer credit.
ASIC’s regulatory mandate is to address corporate misconduct and maintain confidence in Australia’s financial markets. When concerns arise, ASIC has extensive investigatory powers that allow it to move quickly and decisively. These powers include the ability to compel the production of documents, conduct compulsory examinations and execute search and seizure activities.
Investigation is only the first step. Where ASIC considers that misconduct has occurred, it can escalate the matter through a range of enforcement responses. These include civil proceedings to obtain penalties or other court orders, as well as criminal prosecutions in serious cases. For GC, ASIC’s breadth of power means that early decisions on risk management and regulatory compliance can effectively minimise the risk of investigation.
What are ASIC’s Enforcement Priorities for 2026?
For GC, understanding ASIC’s enforcement priorities is critical to anticipating regulatory risk. These priorities signal where ASIC is directing investigative resources and enforcement attention, and they provide a practical guide to what is currently on the regulator’s agenda.
ASIC’s 2026 Enforcement Priorities
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ASIC’s Enduring Enforcement Priorities |
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For further information on ASIC’s enforcement priorities, please visit the official ASIC website: ASIC enforcement priorities | ASIC.
How Does ASIC Select Matters for Investigation?
ASIC receives thousands of reports of potential misconduct each year. These reports can come from the public, other regulators or agencies, statutory reports from auditors, liquidators, Australian financial services licensees, and credit licensees. ASIC also identifies issues through its own monitoring and surveillance programs.
Primary Triggers for Formal Investigation
ASIC considers several key factors when deciding whether to investigate:
- Areas of significant harm: ASIC targets misconduct that can cause major harm to consumers, investors, markets or the financial system. This includes predatory behaviour, systemic misconduct, or conduct with significant market impact.
- Broader public benefit: Cases are more likely to be pursued if enforcement could protect broader public interests and maintain confidence and integrity in Australian financial system.
- Case-specific issues: ASIC evaluates the seriousness of the misconduct, whether it was deliberate or reckless, the financial impact, whether it is ongoing or repeated, and whether sufficient evidence exists.
By understanding these triggers, GC can anticipate when ASIC may get involved, spot areas of potential risk, and strengthen internal controls, reporting, and compliance to minimise regulatory exposure.
Stepping You Through the Process
Once you understand ASIC’s enforcement priorities and how matters are selected for investigation, the next step is to understand the different stages involved in preparing for, responding to, and managing an investigation if it occurs. The following stages provide guidance on navigating the investigation while minimising disruption to the company’s business.
Stage 1: Preventative Measures Before an Investigation
Proactive Risk and Compliance Management:
Regular assessment of risk and compliance frameworks helps businesses stay ahead of potential regulatory investigations. To prevent the high-risk activities that typically trigger ASIC scrutiny, General Counsel must have a clear understanding of ASIC’s current enforcement priorities, as this will help pinpoint the potential irregularities and identify practical improvements when undertaking legal assessments.
Initial Regulatory Engagement and Disclosure Considerations:
ASIC often identifies potential issues through customer complaints, irregularities uncovered in its surveillance programs, or referrals from other regulators or agencies. Taking early steps to address these issues can be critical.
Organisations should first determine whether they are subject to mandatory reporting obligations. Under the Corporations Act 2001 (Cth) and the National Consumer Credit Protection Act 2009 (Cth), holders of an Australian Financial Services Licence (AFSL) or an Australian Credit Licence (ACL) must report “reportable situations” to ASIC. This includes conduct involving significant breaches or likely breaches of core obligations.
Where reporting is not mandatory, organisations should consider whether early or voluntary disclosure is appropriate. When carefully managed, voluntary disclosure can reduce the risk of enforcement action or result in lower penalties.
Finally, businesses should review their insurance coverage and, if necessary, notify insurers before making any official disclosure.
Stage 2: How to React to Statutory Notices and Compulsory Examinations?
Where ASIC determines to commence a formal investigation into irregularities identified through its surveillance programs, it is vested with wide range of information-gathering powers. These include the power to compel the production of books by statutory notice and to require attendance at compulsory oral examinations. As GC, it is crucial to ensure the company understand its rights and statutory obligations when ASIC’s power is enlivened.
Statutory Notices under ss 30 and 33 of the Australian Securities and Investments Commission Act 2001 (Cth) (ASIC Act):
Receiving a notice from ASIC is a serious matter that requires careful attention. Ss 30 and 33 of the ASIC Act give ASIC the power to compel the production of documents for formal investigations.
(i) Steps to Take After Receiving a Notice:
First, review the notice carefully to understand the description of the documents requested, the time period covered, and the deadline for production. If the scope of the documents to be produced is unclear, the notice recipient may seek clarification from the ASIC officer.
Second, identify and mark any documents that are subject to legal professional privilege. This includes documents prepared for legal advice or for litigation. Only documents with a valid privilege claim may be withheld.
Third, review the timeframe for compliance. Normally, the notice recipient must comply with the substantiation notice within 21 days of receiving it. If the documents are extensive or require additional time to retrieve, the recipient may request an extension from ASIC. Any request for additional time must be submitted in writing within the original 21 day period.
Fourth, gather and produce the required documents, delivering them using the method and within the timeframe specified in the notice. Any documents covered by legal professional privilege should be clearly marked and excluded.
(ii) Consequences of Not Complying:
Failure to comply with a s 30 or 33 notice is an offence and can lead to civil or criminal penalties. Providing false or misleading information in response to a notice may result in ASIC issuing infringement notices to individuals or corporate entities.
Compulsory Oral Examination Under s19:
(i) What’s the Nature of S19 Oral Examination?
ASIC has the power to require a person to attend a compulsory oral examination under s19 of the ASIC Act as part of a formal investigation. This power is enlivened where ASIC reasonably believes that a person is able to provide information that may assist or aid its investigation. As a result, s 19 allows ASIC to require a recipient to attend an examination to explain or state a matter, identify a person, matter or thing, disclose information, or answer questions under oath or affirmation.
(ii) Do You Have a Right to Legal Representation?
Although the examination is compulsory, certain rights remain available. The examination is conducted in private, and the content of the examination is confidential. The examinee is entitled to be legally represented, and their lawyer may attend throughout the examination. While the lawyer cannot answer questions on the examinee’s behalf, they may assist by clarifying questions, addressing procedural issues, and helping the examinee properly assert claims of privilege where appropriate.
(iii) What Privileges and Protections Can You Get?
An examinee is not required to disclose information that is subject to a valid claim of legal professional privilege, and the onus rests on the examinee to establish that privilege applies. In addition, while the obligation to answer questions overrides the usual right to silence, an examinee may claim privilege against self-incrimination before answering a question. Where that privilege is properly claimed, the answer given cannot be used against the examinee in criminal or penalty proceedings, although it may still be used for investigative purposes.
(iv) Early Legal Advice:
Given the coercive nature of compulsory oral examinations and the risks of self-incrimination or non-compliance, examinees should obtain legal advice well before the date they are required to attend. In compulsory oral examinations, legal representatives are essential to managing risk by correcting misunderstandings and helping examinees clearly understand their rights to legal professional privilege and protection against self-incrimination.
Stage 3: Understand Your Rights When Responding to an Investigation
Legal Professional Privilege (LPP):
(i) Understanding LPP:
LPP generally attaches to confidential communications between a lawyer and their client made for the purpose of obtaining or giving legal advice or legal services.
For LPP to apply, the communication or document must have been created primarily for the purpose of obtaining legal advice or legal services. This “dominant purpose” is assessed objectively, taking into account the circumstances at the time the communication was made.
LPP generally continues to apply in the context of ASIC investigations, including compulsory examinations and notices to produce documents as we discussed earlier.
(ii) How to Make a Claim of LPP to ASIC?
If you wish to claim LPP over documents requested by ASIC, any claim should be made within the timeframe specified in the notice, or by a later date agreed with ASIC. Blanket claims are not accepted, and each document must be individually described with sufficient detail to allow ASIC to assess whether the claim is valid.
If an examinee seeks to claim LPP over oral information in response to a question during a compulsory ASIC examination, the claim must be made at the examination or by any later time specified by ASIC. The examinee must provide sufficient particulars to identify the privileged communication, the basis of the privilege claimed, and all persons entitled to assert it, including whether the information exists in a recorded form. Where the privilege is held by a third party, additional details must be provided to identify the privilege holder and explain how the information came into the examinee’s knowledge.
(iii) What If the Claim of LPP is Rejected?
ASIC may reject a claim of legal professional privilege (LPP) if, in its view, the claim is not adequately substantiated or is otherwise invalid, including where privilege has been waived or never applied.
If ASIC does not accept your claim, you may withdraw it and provide the information, seek to resolve the dispute through a voluntary LPP resolution process with ASIC, or apply to the court for a declaration that the information is privileged.
Where a claim of privilege is made to hinder an ASIC investigation, it may constitute an offence, and ASIC will seek its costs if it successfully applies to the court for a declaration that the information is not privileged.
(iv) Waiver of LPP:
Privilege may be waived where a party places the content of legal advice directly or indirectly in issue in legal proceedings. This can occur where a party relies on legal advice to support a claim or defence, or advances arguments that cannot fairly be assessed without examining the underlying advice. In these circumstances, courts may find that it would be unfair to allow the party to maintain privilege while simultaneously relying on the advice to advance its position.
In some situations, clients may choose to waive privilege deliberately, for example to assist negotiations or demonstrate cooperation in a regulatory investigation. While this can offer strategic advantages, voluntary waiver carries significant risk. Once privilege is waived, the disclosure may extend beyond the specific document or communication and cannot usually be reversed. Careful consideration and legal advice are essential before taking this step.
Importantly, legal professional privilege does not protect communications made for the purpose of facilitating unlawful conduct, including crimes, fraud, or conduct exposing a person to civil penalties. In such cases, privilege will not attach to the communication at all.
B. Privilege against Self-incrimination:
(i) Do I Have to Comply?
Under section 68 of the ASIC Act, you cannot refuse to provide information, sign a record, or produce a book on the basis that doing so might tend to incriminate you or expose you to a penalty. This means that during an ASIC investigation, the usual privileges against self-incrimination or penalty liability are abrogated, and you are required to comply with ASIC’s requests.
(ii) What Protections are Available?
While section 68 removes the right to refuse, it provides limited use immunity for individuals in relation to oral statements and signed records. If you properly claim the privilege before giving an oral answer or signing a record, that information cannot later be used against you in criminal or penalty proceedings. However, the immunity does not extend to civil proceedings, false statements, or the production of books or documents.
It is important to note that to benefit from the immunity, you must make the claim before responding. If you do not claim privilege at the time, the protection will not apply, even if your response could tend to incriminate you.
(iii) Exceptions: Disqualification and Banning Orders
The use immunity under section 68 does not apply where ASIC is seeking a judicial or administrative disqualification order, or an administrative banning order. In these circumstances, statements given under compulsion may be admissible against you, even if you claimed privilege before responding.
Stage 4: Post-Investigation Remediation and Lessons Learned
What Should I Do After an ASIC Investigation?
Any agreements reached with ASIC should be carefully documented. This includes enforceable undertakings, settlement terms, or court orders, along with any conditions or timelines agreed with the regulator.
After an investigation, organisations should implement and actively monitor compliance with all ASIC mandated actions. This includes fulfilling obligations under court orders, settlement agreements, or enforceable undertakings.
Importantly, ASIC investigations often reveal areas for improvement in internal processes and policies. Organisations should also review and update internal protocols to ensure legal compliance and reduce the risk of future regulatory issues.
Why engage Ironbridge Legal?
Ironbridge Legal helps clients respond to ASIC and other regulatory investigations with confidence. We provide clear, practical advice on section 19, section 30, and section 33 Notices, guiding you through the process while protecting your rights and privileged information. Our team works to ensure your organisation is compliant and well-prepared at every stage.
Further Information
For further information about managing ASIC investigations, responding to section 19 compulsory examinations, handling statutory notices under sections 30 and 33 of the ASIC Act, and protecting legal professional privilege during regulatory inquiries, please contact the author of this article:
Trevor Withane
FOUNDER & MANAGING PARTNER
