FSR GPS: Assessing Criminal Offence Provisions For ASIC Breach Reporting

The breach reporting regime continues to give rise to ambiguity for licensees. As we have commented previously, there continues to be a mismatch in breach reporting practices across the industry and ASIC expectations, as well as a divergence of breach reporting practices between licensees.

A common area of over-reporting is in the context of reporting breaches of criminal offence provisions. A breach of certain criminal offence provisions under financial services law is automatically reportable to ASIC under section 912DAA of the Corporations Act 2001 (Cth) (Corporations Act), due to the provisions on 'deemed significance'. However, in our experience, the applicable 'fault elements' for a criminal offence provision are overlooked or misunderstood when assessing whether there has been a breach.