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ASIC has announced ten key issues for 2026, with a focus on safeguarding trust, integrity and confidence within the financial services and credit industry. These issues align with ASIC's Corporate Plan for 2025-26, which sets out its broader strategic priorities. ASIC's key issues are highlighted below.
1. Inappropriate Financial Advice
ASIC considers the implementation of aggressive marketing and inappropriate financial advice models by retail licensees, has resulted in individuals switching their superannuation to complex and high-risk investments. ASIC will continue to work closely with consumer groups and government to address these issues.
2. Artificial Intelligence
With increasing use of automated decision-making technology and artificial intelligence by licensees and consumers alike, ASIC considers this may result in an increase in technological scams. ASIC's investigations indicate that many businesses do not have appropriate measures in place to combat governance risks surrounding the use of advanced technology.
3. Cybersecurity
ASIC has noted an increase in cybersecurity attacks and data breaches reported to the Australian Cyber Security Hotline. Given the increased reliance on third parties, legacy systems and digitisation, ASIC's focus in 2026 will be to encourage licensees to maintain robust risk management frameworks, undertake stress testing and address any security vulnerabilities with external service providers.
4. Digital Assets
ASIC considers misleading conduct practices and unlicensed advice in the digital asset space to be a key risk for 2026, particularly to individuals that are unfamiliar with financial services. ASIC intends to focus on clarity in relation to licensing requirements in the digital asset space.
5. Insurance Claims Handling
ASIC has noted poor consumer outcomes in the insurance claims handling space, resulting in delays, errors and poor communication with clients. Insurers, brokers and claims handling licensees should revise their complaint management procedures and consider further training for representatives on these issues. Licensees should also ensure a policy exists to manage claims from vulnerable consumers and that representatives know what the policy requires of them when dealing with vulnerable consumers.
6. Private Credit Markets
The expansion of private credit market products to retail clients has resulted in increasing risks. ASIC has monitored private market products and found them to be complex and less transparent than other products, resulting in unsuitable product selection and decision-making without adequate disclosure by licensees. Court action in this space has already been commenced in relation to the collapse of the Shield Master Fund.
7. Superannuation Fund Trustees – Operational Failures
ASIC will continue to monitor superannuation fund trustees' operations due to findings of failures in processing claims in a timely manner, failure to escalate scams, inadequate support and poor IT systems and cybersecurity measures in place. ASIC has concerns that these failures will result in significant financial losses, particularly for vulnerable clients. ASIC will also continue to monitor superannuation trustee practices to understand the steps licensees have taken in relation to high-risk super switching models.
8. CHESS replacement implementation
Delays in the CHESS replacement project has created an increased risk to market stability, integrity and operational resilience. ASIC considers this significantly increases the likelihood of technical failures and operational harm.
9. Financial Reporting
ASIC has raised concerns that financial reports do not include appropriate investment disclosures, adequate transparency on expenses or sufficient audits undertaken on valuations. ASIC has emphasised its continued focus on reviewing financial reports and audits to address these concerns.
10. Competitive Pressures resulting in consumer harm
ASIC considers the banking sector is moving towards riskier strategies due to low net interest margins. ASIC considers this is likely to result in inappropriate credit assessments, unsuitable loans provided to consumers and inappropriate marketing strategies which may steer consumers towards higher-risk products.
How does ASIC's key issues affect you as a licensee?
All licensees should be aware of ASIC's key issues, particularly those in the insurance and the private credit industries. The key issues form part of ASIC's broader Corporate Plan and inform ASIC"s regulatory enforcement focus for this period.
Licensees should be prepared and expect that ASIC will take enforcement action where obligations and responsibilities are breached. It's important for all licensees to be aware of the key issues ASIC will focus on for 2026 to enable licensees to review and uplift their compliance procedures and policies to ensure that they are up to date and effective.
Further Reading
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
