The Take

Make Love Not Medcraft26/10/17

QUTEFS Publication Director, Alex Conroy, discusses the legacy of the departing Chairman of the Australian Securities and Investments Commission and the effects of the latest from the Bank Bill Swap Rate (BBSW) investigation in this week’s this edition of The Take:

As the Corporate top cop looks to hang up his boots in November and settle into a quiet life at the OECD, the jury could quite possibly remain out on a defining moment of his legacy.

The Man:

Greg Medcraft began his career as a chartered accountant at KPMG, before moving into corporate finance at Societe Generale, one of the largest financial services groups in Europe. It was at Societe Generale where Mr Medcraft climbed up the ranks, and from 1987 to 2009, he went from the bullpen to the boardroom, finishing as the Managing Director and Global Head of Securitisation in New York. Mr Medcraft is primarily known for his roles as the CEO and Executive Director at the Australian Securitisation Forum, co-founder of the American Securitisation Forum, and the Chair of the International Organisation of Securities Commission (IOSCO). The illustrious finance professional was also the first Australian to be appointed to the board of the Salzburg Global Seminar, a member of the IMF High-Level Advisory Group of the Interdepartmental Working Group on Finance and Technology, and board member for the Directors of the United States Studies Centre at the University of Sydney.

The Legend:

Highlights of Mr Medcraft’s career with ASIC can be summed up through the following key events:

  • Passing The Industry Funding model of ASIC;
  • The ASIC registry sale;
  • Implementation of the Financial System Inquiry; and
  • ASIC’s exit from the Public Service Act.

Chairman Medcraft looks set to hand over the reins of ASIC during the litigation set against three of the ‘Big Four’ banks (ANZ, NAB, & Westpac) for the alleged rigging of the BBSW between 2010 and 2012. However, Medcraft is adamant he is looking to settle, stating “I proved that with the storm [storm financial] because I want to settle. I’m not a lawyer and you know it’s expensive to go to court”. This statement is a perfect example of what has been a defining tenet of Medcraft’s tenure as Chairman, one in which he sees himself as a forewarner to investors of trouble, and an instigator of intervention and precedent-setting.

This approach towards his duties at ASIC has been met with mixed reviews from both within industry and government. Medcraft had financial commentators both admiring his approach and concluding that he was simply not tough enough. From the government, Medcraft was criticised by Productivity Commissioner Karen Chester, who warned ASIC of being too inwardly focused.


However, Medcraft may yet get his final wish for a settlement of the BBSW with ANZ admitting wrongdoing and settling in a landmark case. The agreed settlement sum amounts to approximately $50-60 million, a figure that will now be the largest civil penalty on Australian records. Both NAB and Westpac remain, holdouts, with NAB rumoured to be close to closing a similar deal.

However, even without a clean-cut finish to Chairman Medcraft’s six-and-a-half-year term, this latest case is both a perfect example of his style and a perfect ending to his legacy at ASIC. Chairman Medcraft will be remembered for his efforts in shining light onto the trading-room culture of the Australian banking system.

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