ASIC Named Private Credit a 2026 Enforcement Priority. Here's What Its Review Found.
ASIC reviewed 28 private credit funds and flagged the sector as a 2026 enforcement priority. For trustees and fund managers, that's a direct signal about the regulatory risk sitting behind management liability cover.
By Jack O'Hagan, Co-Founder & Insurance Broker
Published 6 September 2026 · 4 min read
In this guide
ASIC named private credit practices a 2026 enforcement priority, with a specific focus on fees, margin structures and conflict of interest management in wholesale funds and how private credit is distributed to retail clients.1 The finding sits behind a surveillance review of 28 retail and wholesale private credit funds that ASIC published in November 2025.2 For trustees and fund managers, that combination is a direct signal about the level of regulatory attention this sector is now under.
28 funds reviewed
ASIC's 2025 surveillance covered both retail and wholesale private credit funds
10 principles
what ASIC's REP 820 sets out as its expectations across the sector
A named 2026 priority
private credit fees, conflicts and distribution are a stated enforcement focus
What did ASIC’s private credit review actually find?
ASIC reviewed 28 retail and wholesale private credit funds between October 2024 and August 2025. The report it published, REP 820, described inconsistent disclosure and terminology across the sector, opaque fee and income structures, weak governance and conflicts management, mixed valuation practices, liquidity mismatches and variable credit risk management.2 These aren’t findings against one named fund. They’re a description of where ASIC sees the sector falling short as a whole.
An enforcement priority isn't a prediction about any one business. It's where ASIC has said it will be looking.
What does it mean that private credit is a 2026 enforcement priority?
ASIC’s enforcement priorities set out where it intends to direct investigation and surveillance resources over the year ahead. For 2026, that list names private credit practices specifically. It covers fees, margin structures and conflict of interest management in wholesale private credit funds, including those focused on real estate lending.1 It also covers how private credit is distributed to retail clients through direct and advised channels. It doesn’t mean every fund manager will be investigated. It does mean the sector is operating under active regulatory attention rather than being left to self-report.
What is a trustee or responsible entity actually exposed to here?
A regulatory investigation carries its own cost, separate from whatever it ultimately finds. Responding to an ASIC inquiry, producing documents and defending the conduct of the trustee, the responsible entity and the individuals running the fund can all generate significant legal cost before any outcome is reached. That’s a different exposure to a claim from an investor or a borrower over a specific loan or valuation. It’s typically the kind of cost management liability cover is designed to respond to.
How does this relate to professional indemnity cover?
Professional indemnity and management liability typically respond to different things. REP 820’s findings touch both. A claim that a specific valuation or credit assessment was negligent is typically a professional indemnity matter. A regulatory investigation into how the fund itself was governed, how fees and conflicts were disclosed or how valuations were managed as a matter of process typically sits with management liability instead. Fund managers and trustees commonly carry both, given how closely the two sit together in practice.
Key Takeaways
- ASIC named private credit practices a 2026 enforcement priority, focused on fees, conflicts and distribution in wholesale and retail private credit funds.
- The priority follows a 2025 surveillance review of 28 funds that found inconsistent disclosure, opaque fees, weak governance and mixed valuation practices across the sector.
- An enforcement priority signals where ASIC is directing scrutiny. It isn't a finding against any specific fund.
- A regulatory investigation carries its own legal cost for a trustee or responsible entity, separate from a claim over a specific loan or valuation.
- Professional indemnity and management liability typically respond to different parts of this exposure. Many trustees and fund managers carry both.
The information in this article is general in nature and does not constitute legal, financial or insurance advice. Please speak with a qualified adviser about your specific circumstances.
Footnotes
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Frequently asked questions
Has ASIC flagged private credit as an enforcement priority for 2026?
Yes. ASIC named private credit practices as one of its 2026 enforcement priorities, with a specific focus on fees, margin structures and conflict of interest management in wholesale private credit funds and how these funds are distributed to retail clients.
What did ASIC's private credit surveillance actually find?
ASIC reviewed 28 retail and wholesale private credit funds and reported inconsistent disclosure and terminology, opaque fee and income structures, weak governance and conflicts management, mixed valuation practices, liquidity mismatches and variable credit risk management across the sector.
Does an ASIC enforcement priority mean every fund manager will be investigated?
Not automatically. An enforcement priority signals where ASIC is directing its surveillance and investigation resources, not a finding against any specific business. It does mean trustees and responsible entities operating in this space should expect a higher likelihood of regulatory scrutiny than in a sector ASIC hasn't flagged.
What is a trustee or responsible entity's exposure if ASIC investigates a fund?
A regulatory investigation into a fund can bring significant legal costs for the trustee or responsible entity and the individuals managing it, regardless of the outcome. This is a separate exposure to a claim from an investor or borrower. It's typically the kind of cost management liability insurance is designed to respond to.
What's the difference between professional indemnity and management liability for this exposure?
Professional indemnity typically responds to a claim that a valuation, credit decision or piece of advice was negligent. Management liability typically responds to claims and regulatory investigations tied to how the business and its directors managed the fund itself, including the governance, disclosure and conflicts issues ASIC's review focused on. Licensed trustees and fund managers commonly carry both.
What are the 10 principles ASIC set out in its private credit report?
REP 820 groups ASIC's expectations into 10 principles: stewardship, organisational capability, transparency, design and distribution, fees and costs, conflicts, governance, valuations, liquidity and credit risk. These describe what ASIC expects to see across the sector rather than a checklist for any single fund.
Does this apply to wholesale funds as well as retail funds?
Yes. ASIC's 2025 surveillance covered both retail and wholesale private credit funds. The 2026 enforcement priority specifically names wholesale private credit funds, including those focused on real estate lending, as well as how private credit is distributed to retail clients.
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Jack O'Hagan
Co-Founder & Insurance Broker
Jack spent 6+ years across law, finance and insurance, seeing the impact insurance can have on the growth of a business. With a strong focus on advocacy, he firmly believes insurance broking does not stop after the policy has been placed. It continues when a claim is lodged. He co-founded Cipher Insurance to help Australian businesses get the right broker experience.