ASIC Report: Trust in the Integrity of the Equity Market

ASIC Report Highlights Australia’s Equity Markets as Among the Cleanest in the World

ASIC’s Latest Report Shows Australia’s Equity Markets Among the Cleanest in the World

In a recent report released by the Australian Securities and Investments Commission (ASIC), Australia’s equity markets have been highlighted as operating with a high level of integrity, ranking consistently among the cleanest in the world. The report, titled Equity market cleanliness snapshot report 786 July 2024 (REP 786), sheds light on the importance of maintaining clean financial markets for the wellbeing of Australians and the efficiency of the economy.

ASIC Chair Joe Longo emphasized the significance of clean financial markets, stating that they are essential for businesses to raise capital, manage risk, and give investors confidence to invest. He reiterated that protecting and enhancing the integrity of Australia’s equity markets remains a top priority for ASIC.

The report identified two periods of temporary deterioration in market cleanliness over the past five years, including during the COVID-19 pandemic and a surge in corporate activity in late 2023. In response to these challenges, ASIC took swift action to address harmful conduct, such as pump and dump schemes, chat room manipulation, and leaks ahead of market announcements.

To combat market misconduct, ASIC utilizes a combination of real-time trade surveillance data, analytical tools, and human expertise to detect potential insider trading and other forms of misconduct. In the 2024 financial year, ASIC nearly doubled the number of new insider trading investigations compared to the previous year, demonstrating a commitment to enforcing market integrity.

Looking ahead, ASIC plans to expand its market cleanliness efforts to include private markets and products, reflecting the evolving financial landscape. Mr. Longo concluded by affirming ASIC’s dedication to investing in data and technology to detect and prevent all forms of market misconduct, ensuring the continued integrity of Australia’s equity markets.