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IOOF Won a Case Against Australian Regulator

The banking watchdog of Australia lost a key case versus IOOF. And this occurred after a court ruled that the wealth manager did not breach pension industry laws. As a result, it marks a second setback in as many months for financial regulators seeking to clamp down on misconduct on the country.

On Friday, Federal Court judge Jayne Jagot stated the Australian Prudential Regulation Authority (APRA) failed to show that top IOOF Holdings officials breached pension laws. Earlier, APRA alleged IOOF in misusing pension fund money.

In the previous month, the court ruled against the Australian Securities and Investments Commission. And it dropped the allegations of the corporate watchdog. They accused Westpac Banking Corp in approving mortgages that don’t have enough credit checks.

Aside from that, the back-to-back losses happened even though Australia pushes for stricter oversight of the financial sector. And this was due to the widespread wrongdoing and lackluster enforcement by feeble regulators discovered by a public inquiry last year.

APRA Vs. IOOF

Furthermore, Jagot on Friday also refused to disqualify the IOOF directors, which the APRA requested. Instead, she ordered the regulator to pay for the legal costs of the firm.

She stated, “I have found APRA’s approach, unpersuasive.” Then, she also said that they failed to prove the underlying facts in the present case. On the other hand, an APRA spokesman stated the regulator was reviewing the judgment. And it will give a response shortly.

Meanwhile, shares of IOOF surged as high as 8.1% to A$6 or $4.07 following the news. And this will be its highest since early May.

Last December’ unprecedented move, APRA began to seek disqualification of five IOOF executives through a court order. And their reason is they fail to act or move according to the needs and interest of its consumers.



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