Financial Accountability Regime (FAR)

The Financial Accountability Regime (FAR), which commenced in March 2024, replaced the Banking Executive Accountability Regime (BEAR) and extended accountability requirements to insurance and superannuation sectors. FAR requires certain financial institutions to register accountable persons with APRA, clearly delineate their responsibilities through accountability maps and statements, conduct background checks, and ensure proper notification of breaches. Accountable persons include directors, senior executives, and anyone with significant influence over the institution. The regime aims to improve governance, risk management, and culture by making individuals directly responsible for their areas of oversight. Key obligations include: a duty to conduct business in a proper manner with due skill, care, and diligence; a duty to take reasonable steps to prevent breaches; and a duty to cooperate with regulators. Penalties for failing to meet FAR obligations include substantial civil and criminal penalties, disqualification from the industry, and potential imprisonment. FAR creates a clear line of accountability from frontline practices to executive leadership.