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Australian regulator promises big bank lawsuits by year-end - media

Australian regulator promises big bank lawsuits by year-end - media
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SYDNEY (Reuters) – Australia’s investment regulator plans to file lawsuits against some the country’s biggest financial companies within weeks after it reported an increase in active investigations, media reported on Monday.

The Australian Securities and Investments Commission (ASIC) also said in a report published on Sunday that it planned to hire more analysts, investigators and lawyers to boost its capacity to probe “and where necessary litigate against, market, corporate and financial sector misconduct”.

The regulator said in that report the number of enforcement investigations it was conducting grew by a fifth over the year to end-June, compared with the previous year, while investigations involving what it called “the big six” rose by half.

In an interview with the Australian newspaper on Monday, ASIC Deputy Chair Daniel Crennan said proceedings involving the “big six” would be issued before Christmas.

The paper added that the big six referred to the four largest retail lenders Commonwealth Bank of Australia <CBA.AX>, Westpac Banking Corp <WBC.AX>, National Australia Bank <NAB.AX> and Australia and New Zealand Banking Group <ANZ.AX> plus top investment bank Macquarie Group Ltd <MQG.AX> and top financial planner AMP <AMP.AX>.

In a separate interview with the Australian Financial Review also published on Monday, Crennan said the regulator had “a very large number of investigations on foot and there will be cases being issued in coming weeks, which are the result of those investigations”.

Neither newspaper report provided details of the proposed legal action.

Australia’s finance sector regulators have faced calls to increase scrutiny of major lenders after an inquiry found widespread cases of knowingly selling investment products to people who could not afford them and taking billions of dollars in customer fees without providing a service.

Last week, ASIC faced additional pressure after losing a court action against Westpac, the No. 2 lender, in which the regulator accused the bank of using overly vague methods to calculate people’s ability to pay their mortgage.

In the update, ASIC said its investigations involving wealth management companies grew 216% over the past year, although it did not name the companies it was investigating.

(Reporting by Byron Kaye; Editing by Sam Holmes)

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