Dr Wilson N. Sy, – the former head of research for APRA, and executive at ASIC and the Australian Treasury – has published a paper attacking the “farce of fake regulation” after it was exposed by the banking royal commission. Below is the extract:
The revelations from the Hayne Royal Commission (HRC, 2019), limited though they were by the terms of reference, have come as a shock to most people, including Australian politicians, officials, academics and the media. Their expressed shock indicates a high degree of ignorance about the Australian financial system. For decades, the public was led to believe that Australia has the best financial system in world, being one of the few countries to have avoided a recession in the global financial crisis (GFC).
This complacent view was contradicted by the HRC and this fact needs to be understood and explained. The HRC Final Report lacks an explanation for its major finding that the regulators had failed to enforce the law. The report merely recommended the regulators be more active, when it did not discover why the regulators had been so passive in the past. This paper provides detailed explanations for the observed failure to regulate based on published research, new or old empirical evidence and industry insider experience.
