Another response from the same guy at ASIC, this is the line that pretty well sums up ASIC's attitude to anyone that dares to complain about misleading/unethical/unfair/criminal trading on the ASX.
" On the basis of the information presently available and after making enquiries into the trading in the Company’s securities, ASIC does not intent to take any action in relation to your concerns."
reply in full from ASIC.....
Dear Mr. XXXXX
IMF (AUSTRALIA) LTD CAN 067 298 088 (‘THE COMPANY’)
I refer to our previous correspondence of 8 January 2013 in reply to your letter dated 3 January 2013.
You raised concerns about the possible manipulation of the Company’s share price though algorithmic trading on 27 December 2012, specifically, by a number of cancelled single volume trades which you believe constituted wash trades.
ASIC also notes your general comments about the effect of algorithmic trading on the market as a whole.
ASIC’s role
ASIC is responsible for the administration and enforcement of the provisions of the Corporations Act 2001. Part of ASIC’s role as a regulator is to ensure compliance with the legislation governing the provision of financial products and services. ASIC conducts an assessment of every report of misconduct we receive. In determining which matters we will select for further action, consideration is given to a range of factors, including the likely regulatory effect of any available action.
Algorithmic Trading
ASIC notes your comments in relation to the practice of algorithmic trading and your request that ASIC take steps to eliminate the practise. On the basis of the information presently available and after making enquiries into the trading in the Company’s securities, ASIC does not intent to take any action in relation to your concerns. ASIC can review this matter at any time in the future should we consider it appropriate, necessary or in the public interest to do so.
ASIC’s position
ASIC is bound by the evidentiary requirements of the Courts. This means that in order to proceed with a criminal prosecution ASIC must ensure that all the elements of the criminal offence can be proven.
In a recent Keynote speech by Greg Medcraft, Chairman, Australian Securities and Investments Commission to the Stockbrokers Association of Australia 2012 Annual Conference, 1 June 2012. ASIC reconfirmed its commitment to maintaining market integrity in a changing environment, making specific reference to continuing to work with participants and their clients to reduce the risk of algorithms having a negative impact on market integrity.
As the market regulator, ASIC is responsible for the supervision of market operators, market participants, financial markets and clearing and settlement facilities. While ASIC may advise the Australian Government on matters concerning the regulation of Australia’s capital markets, it is not a law reform body.
As such, to the extent that you request that ASIC should enact legislative reforms in relation to algorithmic trading, we advise that this is a function carried out by the Australian Government and Treasury. For contacts details and further information regarding the functions of Treasury, please visit www.treasury.gov.au. You may also wish to make a representation to your local member of parliament in relation to any suggested law reform.
You may also be aware that ASIC recently released a second-phase consultation paper on equity market structure issues arising from recent and anticipated developments in Australia’s financial markets. Consultation Paper 168 ‘Australian equity market structure: Further proposals’ (“CP168”) sought views on existing regulatory issues such as dark pools, high frequency trading, automatic trading entry and order entry controls. ASIC is aware that the trend to increased automation and associated trading activities has been occurring in the market for some years, and will continue in the advent of competition in the market place. CP168 proposes enhancements to ensure we maintain a strong and robust regulatory framework in that changing environment.
If you have any questions in relation to this letter please contact me on (08) 8202 8493.
