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Enforcement

This section provides information on how we use our enforcement discretion to ensure the entities we regulate comply with their obligations. Find out about our enforcement framework, and how we have used our enforcement powers.

Purpose of enforcement

In most circumstances, our policy and supervision functions are effective in achieving our purposes and objectives. However, the effectiveness of these functions depends on regulated entities knowing that we will take firm action where non-compliance is identified and risks are not being properly addressed. Where serious non-compliance is identified, our legislation allows us to take enforcement responses where appropriate. The enforcement responses available to us depend on the relevant legislation, and include warnings, enforceable undertakings, and civil/criminal proceedings. We will determine the appropriate response based on our enforcement approach and our enforcement framework.

See our enforcement approach

Our enforcement framework

Our enforcement framework provides guidance on how we act, or propose to act, in relation to our regulated entities, when using our enforcement discretion. The enforcement framework consists of several pieces of public guidance which should be read alongside each other to provide an understanding of our enforcement process:

  • Principles and Criteria Guidelines - describe the fundamental considerations for the enforcement framework that we will work through and weigh when deciding on the appropriate enforcement response. The enforcement principles are a set of values that guide the direction of our investigation and enforcement strategy and inform our approach to applying our enforcement discretion. Our three enforcement principles are: risk-based, proportionate, and transparent. The enforcement criteria are specific considerations which will be worked through and weighed against the available evidence when deciding on the appropriate enforcement response to non-compliance. Our four enforcement criteria are: seriousness of conduct, responsiveness, public trust and confidence, and efficacy.

  • Enforcement Guidelines – Will be developed in due course and will describe our response model and provide further detail on how we apply the enforcement principles and criteria when selecting the appropriate response.

  • Investigation Guidelines – Will be developed in due course and will describe our approach to formal investigations and how we apply the enforcement principles and criteria throughout the lifecycle of an investigation. The Investigation Guidelines also describe our use of information gathering powers under our legislation. 

Reporting misconduct

We generally discover non-compliance with legal obligations through our supervision of our regulated entities. Employees of regulated entities may also report potential failures to us (known as ‘whistleblowing’).

See how employees can report misconduct of a regulated entity

How we have used our enforcement powers

Our enforcement register lists the enforcement actions we have taken, both in relation to entities we regulate and other organisations operating in the financial system.

See our enforcement register