ASIC responds to brutal report that raises splitting the authority in two

The inquiry report, tabled in the Senate on Wednesday, made 11 recommendations regarding the Australian Securities and Investments Commission.

It recommended the federal government strongly consider separating ASIC's functions between a companies regulator and a financial conduct authority.

The committee, chaired by Liberal senator Andrew Bragg, found ASIC receives thousands of reports of misconduct each year but investigates only about 1 per cent of them.

In response to the inquiry, an ASIC spokesperson said the regulator pursues corporate wrongdoing every day.

"Throughout the inquiry we have shared our strong enforcement record on behalf of Australian consumers and investors," the spokesperson said.

"ASIC is in court almost every day pursuing wrongdoing and in the last 12 months alone launched around 180 new investigations."

The ASIC spokesperson said it would consider the report.

"We note the release of the chair's report, dissenting commentary from the deputy chair, and the Treasurer's comments about it this week," they said.

Treasurer Jim Chalmers told ABC Radio on Monday he believed ASIC was still a tough regulator.

"... I meet with [ASIC chair] Joe Longo and his colleagues from time to time, I met with them on Friday actually about some of the issues around making sure that ASIC is its best version of itself," he said.

ASIC is working with Treasury to act on the recommendations from a 2022 review by the Financial Regulator Assessment Authority, the spokesperson said.

The damning Senate inquiry found ASIC had "comprehensively failed to fulfil its regulatory remit" and should be overhauled.

However some committee members criticised Mr Bragg's report and the handling of it.

Labor Senators Jess Walsh, Deborah O'Neil and Jana Stewart said they were given just 24 hours to access the report and its recommendations.

While they agreed there was an opportunity for improvement at ASIC, the senators said the report reduced the significant evidence of the nearly two-year inquiry to "little more than a headline".

The senators said the report largely ignored views from stakeholders.

The report assumed ASIC would be split into two bodies "without detailing how that could occur" and overlooked sensible reforms, the senators said.

Among its 11 recommendations, the report said the government should "urgently address" the shortcomings in handling alleged corporate misconduct and make it a legislative requirement for ASIC or future bodies to investigate reports of alleged misconduct at an appropriate rate.