Financial Services & FinTech: 2022 Year in Review


Reflecting on 2022, our National Financial Services & FinTech team shares some of the industry trends and significant matters of the year, and what we can expect in the next 12 months.

“Regulatory reforms affecting the financial services industry have continued to roll out over 2022, including some long-awaited reforms in relation to electronic delivery and execution that were finally made in response to the COVID pandemic.  And increasing interest rates have resulted in many providers having to revisit processes they’ve not had to put into action for over a decade!  The industry has continued to evolve rapidly, and I’m pleased to say that our team has been there to support our valued clients every step of the way.”

Shannon Adams – Practice Team leader

Industry insights 

This year, the financial services industry has seen significant reform, proposed regulation and increased scrutiny, following unprecedented security breaches.

The recent Optus and Medibank hacks shone a spotlight onto the importance of having strong and reliable privacy and cyber security measures, particularly for Australian Financial Services licence (AFSL) holders. This was evident in Australian Securities and Investments Commission v RI Advice Group Pty Ltd [2022] FCA 496 (ASIC v RI Advice), where the Federal Court (FCA) held that RI Advice’s cybersecurity measures were inadequate, and that Directors of AFSL organisations may be held personally liable if the organisation’s measures were found to breach the Corporations Act 2001 (Cth). As a result, Directors and Officers must ensure the appropriate specialists are being used to examine and establish adequate controls to minimise risks related to cybersecurity and cyber resilience. Organisations should have in place a cyber breach plan BEFORE they experience a cyber hack. Delays in responding to a cyber hack enhance the possible damage scenarios.

We have also seen a regulatory response to the need to minimise the threat of financial hardship for consumers of products such as Consumer Leases and Small Amount Credit Contracts. The Financial Sector Reform Bill 2022 (FSR Bill) – which was introduced alongside the long-awaited Financial Accountability Regime Bill 2022 – proposed an ‘anti-avoidance’ provision for small amount credit contract and consumer lease products. The FSR Bill was passed on Friday 2 December 2022.

Earlier in the year, we saw the FCA overturn the decision of Brookfield Multiplex Ltd v International Litigation Funding Partners Pte Ltd (2009) 180 FCR 11, and rule that litigation funding agreements are not managed investment schemes (MIS) in LCM Funding Pty Ltd v Stanwell Corporation Limited [2022] FCAFC 103. This means that funded class actions are not required to register as a ‘scheme’ – consequently, reducing the regulatory hurdles for class action litigation funders and potentially increasing the number of funded class actions we will see in the future.

Based on the increasing focus on penalising breaches of the Competition and Consumer Act 2010 and amending Australia’s legislation on unfair contract terms, the Treasury Laws Amendment (More Competition, Better Prices) Act 2022 was passed in late October. We have seen both ASIC and the ACCC bring a number of investigations and other legal proceedings to the courts, so we suggest companies get on the ‘front foot’ and ensure they are across the changes and review their current contracts.

Another reform which will impact organisations are the changes around new product design and distribution obligations. These reforms will see issuers be required to inform ASIC of a significant dealing in a financial product that is inconsistent with the product’s Target Market Determination (TMD). ASIC has also issued stop orders in relation to interests in a fund and shares in two separate but related companies. These orders are markers of a shift in ASIC’s focus to compliance, and we suggest organisations take action to minimise the likelihood of having inconsistent distribution with the TMD, as well as ensuring the requirements of the Design and Distribution Regime are clear and actionable.

In October, ASIC released Report 740 – the first report released under the new breach reporting regime. The new regime was brought into effect in 2021 with the aim of altering licensee self-reporting behaviour on breaches. Report 740 suggests that the breach reporting regime is not performing as expected. We saw a significant disparity in reporting conduct – as well as expectations – between licensees. This indicates that whilst the new breach reporting regime was introduced to provide greater clarity and consistency, there are still areas for improvement We expect to see further changes throughout 2023.

It has been a turbulent year in the blockchain and digital assets industry following the collapse of a number of high profile exchanges and funds includin FTX,   Three Arrows Capital and Celsius. We nevertheless continued to see a high level of activity in the blockchain industry as developers continue building through crypto winter and investors look to take advantage of more favourable valuations.

A major theme in 2022 was regulation as industry leaders domestically and overseas called for enhanced regulation of crypto-asset intermediaries and greater clarity in relation to the regulatory treatment of crypto-assets. In November, the Federal Government announced that it would accelerate plans to introduce a legislative regime for cryptocurrency exchanges and custodians in 2023. Senator Bragg, who led the Senate Inquiry into Australia as a Technology and Financial Centre, also released a draft private member’s bill which will no doubt be the subject of further debate as the Treasury pursues a consultation on token mapping in early 2023 as a stepping stone to introducing its own draft legislation.

As we entered the final months of 2022, ASIC stepped up enforcement action in relation to crypto-asset based products initiating proceedings against BPS Financial Pty Ltd for allegedly unlicensed conduct in relation to its crypto asset, Qoin, and Block Earner in relation to its crypto-asset based yield offering. ASIC also issued interim stop orders against Holon Investments Australia Limited relating to the distribution of three funds to retail investors because of non-compliant target market determinations. We anticipate further regulatory enforcement activity in 2023 as ASIC steps up its scrutiny of regulated crypto-asset offerings and targets unregulated crypto-asset offerings that mimic traditional financial products.

Finally, we saw the Federal Government turn to the ‘Buy Now, Pay Later’ sector and proposed mandatory regulation. Whilst there is currently a voluntary ‘Buy Now, Pay Later’ (BNPL) code, we saw the government look to regulate through the National Consumer Credit Protection Act, which we expect to be introduced in 2023. This regulation would see Australian consumers obtain additional support with managing their cashflow, as well as ensuring BNPL products are safe and marketed as such.

Team movements

Our Melbourne office welcomed Steven Pettigrove (Special Counsel) and Jake Huang (Lawyer); our Sydney office welcomed Lola Hickey (Law Clerk) and our Adelaide office welcomed Chelsea Veprek (Law Clerk). The team also celebrated the promotion of Sally Fetouh (Senior Associate, Sydney) at the start of 2022.

Significant matters

Throughout the year, we continued to represent and advise our clients, across various industries and geographies, including:

People’s Choice Credit Union
Throughout the year we acted for People’s Choice in relation to its proposed merger with Heritage Bank.  The merger was approved by members of both institutions at meetings in November and is expected to take effect in March 2023.   The merged institution will be the largest mutual financial institution in Australia.

D H Flinders Pty Ltd
Acted for D H Flinders in relation to Supreme Court proceedings against the Australian Financial Complaints Authority (AFCA).

Fi-Fit Services Pty Ltd
Assisted Fi-Fit Services by drafting contracts for its proposed new product and advising on how Fi-Fit Services could take security interests in cryptocurrencies.

Immutable Pty Ltd
Supporting Immutable’s Business Development team in their engagement by Digital Worlds NFTs to procure, negotiate and submit potential grant applications to Digital Worlds for approval in connection with projects building to build on the Immutable X Protocol and deploy Non-Fungible Tokens within video games.

Independent Reserve Pty Ltd
Provided commercial advice to one of the oldest and largest digital currency exchanges, conducting regulatory analysis of potential new products, cryptographic tokens and associated advice.

Lygon 1B Pty Ltd (Lygon)
Advised on corporate, commercial, employment, strategic and fundraising matters and assisting in relation to Blockchain matters relevant to the business.

Monochrome Asset Management Pty Ltd
Advised Monochrome in relation to the establishment of a Bitcoin wholesale managed fund including preparing all fund documentation, advising on and considering issues of digital asset custody within a regulated fund structure.

Oxen Foundation Ltd
Advised Oxen in relation to corporate governance and the ongoing development of their privacy centric and Blockchain based messaging service, Session.

The HBar Foundation
Supporting the HBar Foundation in its grant program where grants are provided for businesses building carbon trading and other socially beneficial financial market systems.

The Polygon Group Pty Ltd
Reviewed and advised on an updated version of The Polygon Group’s online application form, which is intended to be more user-friendly than The Polygon Group’s current application process.


Across our National Financial Services & FinTech practice team, we have received a number of individual and team accolades this year. We thank our clients and colleagues for their ongoing support.

The Legal 500 Asia-Pacific

In the 2022 edition of The Legal 500 Asia Pacific, Piper Alderman was recognised across 12 areas of law including Financial Services Regulatory. Partners in our team were highlighted as recommended lawyers for this category, including Shannon Adams, Michael Bacina and Andrea Beatty.

Chambers and Partners

In the 2023 edition of Chambers and Partners, Piper Alderman was recognised as Band 3 in the Chambers Fintech Guide, Fintech Legal. Chambers also recognised the following partners:

  • Michael Bacina – Chambers Fintech Guide, Fintech Legal (Band 1)
  • Andrea Beatty – Asia Pacific, Financial Services Regulation (Band 3)

The Best Lawyers in Australia

In the 2023 edition of The Best Lawyers in Australia, 52 of Piper Alderman’s lawyers are recognised across 42 legal areas including the following partners in our Financial Services and Fintech team:

  • Shannon Adams – Banking and Finance Law, Corporate / Governance Practice
  • Andrea Beatty – Financial Institutions, Privacy and Data Security Law, Regulatory Practice
  • Mark Gordon – Banking and Finance Law, Commercial Law, Corporate Law

Doyle’s Guide

In the 2022 edition of Doyle’s Guide, Piper Alderman is recognised as a First Tier Leading Banking & Finance Law Firm in South Australia. Some of our partners were also recognised:

  • Joshua Annese – ‘Leading’ Banking & Finance Lawyers in South Australia
  • Mark Gordon – ‘Leading’ Banking & Finance Lawyers in South Australia

Michael Bacina, a partner in our Sydney office was also recognised as ‘Fintech Expert of the Year’ at the Leaders in Law 2022 Global Awards.

Most recently, Michael Bacina and Greg Conomos were recognised in the Autumn edition of the 2022 Mondaq Thought Leadership Awards, which showcased the top authors for Mondaq based on total readership.

We were also delighted to receive some very kind feedback from clients and contacts during the research process for the legal directories, including:

Andrea Beatty and her colleagues have extensive industry experience having worked with numerous financial services and payment system participants over many years. This experience provides them with significant insight into the practical considerations that apply when assisting their clients.” (Legal 500 Asia-Pacific, 2022)

“Extensive experience in the payments industry and financial services generally coupled with excellent legal skills. Client communication is excellent, and they are always available, often at short notice, to assist and provide advice.” (Legal 500 Asia-Pacific, 2022)

Michael Bacina and his team go above and beyond to deliver the best advice and executes well. Piper Alderman demonstrates exemplary service and conduct in the legal field.” (Legal 500 Asia-Pacific, 2022)

Business Development

Our lawyers have presented at numerous conferences, seminars and workshops over the course of the year, and have conducted a number of webinars.  It’s been great to get back to attending events in person in 2022.

In August, Michael Bacina and Steven Pettigrove joined Lawyers’ Weekly to discuss the latest regulatory updates in the non-fungible token (NFT) space, and what these changes might mean for legal practice moving forward.

The ‘Blockchain Bites’ blog continued again in 2022, capitalising on the success from 2021. Having developed over 40 blogs this year, Michael Bacina and his team provided weekly insights into the Blockchain and Cryptoassets space – resulting in our clients taking advantage of regular, reliable and expert industry insights.

Our team has also authored the Australian chapters of Lexology’s Getting the Deal Through – Banking Regulation Australia, 2022 edition, The Consumer Finance Law Review – Australia Chapter, edition 6, and The Banking Regulation Review – 13th Edition Australia, 2022 Edition.

Andrea Beatty continued to conduct her CPD workshops, updating Australian Credit Licence (ACL) and Australian Financial Service Licence (AFSL) participants on their compliance obligations, current regulatory issues and other ‘need to know’ pieces of information for Responsible Managers and Representatives. This highly valuable series will continue both in-person and virtually throughout 2023.