Australia’s corporate cop has long been fighting off claims that it’s a toothless tiger – a criticism that comes with the territory. But when Joe Longo became chair of the Australian Securities and Investments Commission (ASIC) in 2021, he faced more than the usual challenges that confront every ASIC boss.
The leadership of ASIC appeared to be in disarray, after Longo’s predecessor James Shipton had stepped down, despite being cleared of any wrongdoing in a formal review of public money being used to prepare his tax returns. The former deputy chair Daniel Crennan had also resigned after scrutiny of his almost $70,000 in housing expenses – an independent report also cleared Crennan of wrongdoing.
ASIC was still recovering from the caning it took at the 2018 banking royal commission, which found it was a timid regulator that was too close to banks.
At the same time, the government had signalled it wanted ASIC, which enforces corporate law and polices conduct in the financial services sector, to support the economy’s recovery from COVID-19.
So how has Longo, who steps down at the end of this month, steered ASIC through these tricky waters? Has Australia’s corporate regulator got its bite back under his watch?
Longo, who will be replaced by deputy chair Sarah Court, acknowledged in a speech this week that ASIC had “challenges” when he began, saying it faced claims that it was a “watchdog with no teeth”.
In response, he tried to beef up its work investigating the financial sector, while also being clearer in telling the public about areas it was targeting.
A key change he and Court made soon after their appointments was to announce ASIC’s enforcement priorities annually – something Longo argued has been important for making it accountable to the public.
Helen Bird, a corporate governance expert and senior law lecturer at Swinburne University of Technology, says this naming of its enforcement priorities has been “very important” for communicating what ASIC does.
Bird says that early on in Longo’s time, ASIC appeared “defensive” by frequently talking about how often it was in court, but listing its priorities has been helpful.
‘I’m not known for patience as being one of my top three virtues. I think we did as much as we could.’
ASIC chair Joe Longo
“I think that since they’ve done that, he’s had a much greater success at communicating what ASIC does, where it’s effective, accepting loss because it does lose cases still, and generally being less defensive,” says Bird, a member of the ASIC corporate governance panel, an unpaid role in which she provides feedback to the regulator on governance issues.
In 2023, there was also a major internal restructure that brought its enforcement teams together.
Longo’s professional background also probably helped him in balancing the many priorities of an ASIC chair. He was a former director of enforcement at ASIC between 1996 and 2001, while also working for Deutsche Bank for 17 years, as well as an earlier stint at law firm Herbert Smith Freehills. Bird says this experience gave Longo the gravitas, authenticity and credibility that meant his appointment was well received.
A highlight of his tenure included a landmark lawsuit against former Star directors, which alleged they failed to properly oversee anti-money laundering protocols at the company’s casinos. ASIC lost its case against the directors, but won against some Star executives.
Speaking this week, Longo argued that under his watch ASIC had sought to become “modern, confident and ambitious”. To support the claim that it was more ambitious, he pointed to its pressure on banks over how they support customers in hardship, as well as work that’s resulted in banks refunding more than $160 million to lower-income customers.
He also said that ASIC now undertook twice as many formal investigations a year than when he started, while the penalties it obtained had increased four-fold between 2019-20 and 2024-25. ASIC also says its civil proceedings increased by 35 per cent between the second half of 2020-21 and the second half of 2024-25.
Asked this week if he could have gone harder on anything during his time as chair, Longo replied: “Harder on everything.”
“I’m not known for patience as being one of my top three virtues. I think we did as much as we could,” he said.
However, critics claim that ASIC under Longo still lacks bite.
One of the most vocal of those critics is Liberal senator Andrew Bragg, who in 2024 led a damning inquiry that concluded ASIC was ineffective in chasing down crooks, was letting down investors, and should be broken up.
Bragg stands by the criticisms today, saying that ASIC is still too slow to act against corporate wrongdoing and to protect investors.
He points to the collapse of the Shield and First Guardian investment schemes, in which investors have lost more than $1 billion after people switched their superannuation to the high-risk scheme. People who lost their savings had often signed up via “lead generators” that offered free super “health checks” online – ASIC now says it suspects “industrial scale” misconduct.
Bragg maintains that ASIC was warned about the problems with Shield and First Guardian but that it failed to act, and is instead cleaning up afterwards.
Bragg also criticises the government, saying it didn’t respond to the damning Senate report into ASIC.
“It’s the world’s biggest securities regulator in terms of its breadth. It’s just doing too many things,” Bragg says. “I just don’t think they’re a feared regulator.”
Backers of Longo, however, say Bragg’s criticisms don’t stack up.
Graeme Samuel, a former chair of the Australian Competition and Consumer Commission, argues that Bragg’s criticisms were misdirected, and he maintains that Longo has shown ASIC has a clear focus on enforcing the law.
“You don’t see Joe out there spending his time getting politically involved in advocacy for … politically coloured outcomes or anything like that,” Samuel says. “He’s just out there to enforce the law.”
Samuel, who describes himself as a friend of Longo, says Longo has managed to clearly represent what ASIC can and can’t do. He says this has helped the perceptions of ASIC’s capabilities to “converge” with reality, which is important for the public to understand what ASIC is capable of.
Helen Bird also rejects the argument that ASIC is “toothless”. She points to the practical difficulties of living up to the public’s expectations for ASIC to be a tough cop on the beat, such as the fact that judges don’t always award tough penalties, as well as the fact that ASIC has limited funds to pursue people.
“I think that some of it is about realising you can’t expect them to do more if you aren’t prepared to give them more money,” Bird says.
On the Shield and First Guardian collapses, Bird also says it’s complicated. She says some people suggest ASIC should never have given financial services licences to Shield and First Guardian in the first place, but adds that it is complicated by the fact there are many parties involved in what went wrong, including financial advisers, brokers and investment platform managers.
“I think it demonstrates that in these complex areas there are lots of parties who contributed to the problem, and that suggesting the regulator is responsible is simplistic,” Bird says.
Simplistic or not, ASIC’s central role in the corporate world and investment markets will ensure it continues to attract scrutiny of its performance.
And the threat of financial misconduct will continue to evolve with technological change, and as the nation’s $4.5 trillion superannuation pool grows ever larger.
Longo’s final speech this month pointed to evolution from new technology – noting that AI had turbocharged the scam threat – and called for policy changes aimed at preventing the lead generators that enabled a “conveyor belt of consumer harm” in the Shield and First Guardian collapses.
There is little doubt that Court, Longo’s successor, will have her work cut out.
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