News: Australia examines tougher penalties for white collar crime

The Australian government is planning to increase penalties and lengthen prison terms for financial crimes in a bid to strengthen the enforcement powers of the corporate regulator following a series of scandals.

Penalties for financial crimes should be more than doubled, fraudulent gains of companies and banks should be seized, and maximum prison terms lengthened, an interim report released by the government on Monday recommended.

The government is seeking to improve public confidence in the financial system and give more power to the Australian Securities and Investment Commission (ASIC), which has been criticised for lacking clout amid a series of corporate scandals.

Companies and banks including the Commonwealth Bank of Australia (CBA) and Tabcorp Holdings (TAH) have this year been accused of breaching anti-money laundering and counter terrorism financing laws.

The government is accepting submissions on its proposed changes until mid-November, before making its final policy decision.

Financial Services Minister Kelly O’Dwyer said the changes would give ASIC the "right tools to combat corporate and financial sector misconduct and to protect consumers".

The Reserve Bank of Australia (RBA), which alongside the prudential regulator, oversees the strength of the financial system, this month acknowledged cultural problems and poor internal controls at the banks, resulting in misconduct and loss of public trust.

The proposals include increasing maximum civil penalties for individuals to A$525,000 ($411,023) from A$200,000, and A$2.63 million for corporations from A$2.1 million; and giving ASIC powers to deal with a wider range of offences. ($1 = 1.2773 Australian dollars)