ASIC ramps up scrutiny of misconduct in financial services

ASIC is concerned that misconduct in financial services remains persistent and damaging. Longo pointed to recent enforcement actions and reviews that reveal troubling patterns – poor advice, conflicts of interest and failures in governance. These aren’t one-off incidents. They are widespread problems that damage consumer confidence and threaten market integrity.

Longo outlined a plan that steps up pressure on the sector and raises the stakes for misconduct:

• Enforcement is accelerating – ASIC has doubled new financial advice investigations and almost doubled investment management probes. Major cases such as Shield and First Guardian already involve more than 40 investigators and over 40 court appearances. ASIC's 2025 enforcement priorities include targeting misconduct that exploits superannuation savings and property investment schemes.
• Surveillance is intensifying – platform trustees are being tested on how well they vet investment options, and advice licensees using lead generation are under scrutiny. Longo was blunt: 'you are the first line of defence.'
• Consumer education is expanding – ASIC's second awareness campaign warns against high-pressure sales tactics and promises that sound too good to be true, aiming to shift consumer behaviour before more harm occurs.

One of Longo’s strongest messages was that ASIC can't do it alone. He compared the task to anti-scam efforts, where coordinated action across telcos, banks, and regulators has already helped reduce losses.

A similar whole-of-industry approach is needed here. ASIC's data collection powers for managed funds are limited, meaning industry participants often see problems before the regulator does. Longo used a supermarket analogy to emphasize his point: trustees must check products are fit for purpose before putting them 'on the shelves.'

His warning was clear – if you can prevent harm, you’re also accountable when harm occurs.

Longo highlighted a bigger challenge: how to deliver quality financial advice in a time of rapid technological change, shifting demographics and regulatory reform. While he acknowledged the complexity of the advice sector, he urged industry leaders to stay focused on the basics such as acting in the best interests of the client, managing conflicts and maintaining professional standards.

He stressed that ASIC is not anti-advice. The regulator supports a vibrant, sustainable advice sector, but one built on integrity. The future of advice, he argued, must be built on trust, not just compliance.

Longo challenged firms to go beyond box-ticking and commit to genuine ethical conduct. Culture, he said, is a key driver of behaviour, risk, and reputation. This reflects ASIC’s view that good conduct is good business. Firms that invest in culture through leadership, training and strong governance are not only meeting regulatory expectations; they are also building resilience and a competitive edge.