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Australia Takes Major Step in TPLF Regulation

Australian Treasurer Josh Frydenberg is set to announce new regulations and rules for third party litigation funding, according to the Australian Financial Review.

Litigation funders will be classified under the country’s Corporations Act, and the government will require all funders to hold an Australian Financial Services Licence in order to operate. This also means that funders will be brought under the Australian Securities and Investments Commission’s oversight and that they will have to comply with Australia managed investment scheme rules.

“Now more than ever we want Australian businesses staying in business and focused on keeping people in jobs rather than fending off class actions funded by unregulated and unaccountable parties,” Frydenberg said. “The number of class actions has tripled over recent years. It is now even more important that litigation funding activities are regulated in a manner that is consistent with other financial services and products that seek to provide investment returns to consumers.”

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Australian Class Action Lawyers Face Criminal Investigation Over “Grossly Unethical Behaviour”

group of class action lawyers in Australia “are facing a criminal investigation and a damages bill of more than $11.7 million for ‘dishonourable’ and ‘fraudulent’” conduct, reports the Australian Financial Times. The lawyers and litigation funder involved attempted “to claim more than $19 million in legal and funding fees from a group of elderly investors in the Banksia class action.”

Game Is Up For Litigation Funders

Last week, the Australian Financial Review featured an op-ed written by Stuart Clark, an adjunct professor at Macquarie Law School and former president of the Law Council of Australia, that highlights the need for reforming Australia’s litigation funding industry.

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