The Australian Securities and Investments Commission will be given power to intervene in financial product marketing and ban the sale of a product.Under reforms detailed in a consultation paper issued by Treasury yesterday, ASIC would have the power to impose additional disclosure requirements, mandate warning statements and changes to advertising material. It would also have the power to restrict or ban the distribution of a product.The regulator would have to identify "a risk of significant consumer detriment."It would have to undertake consultation before exercising these powers.An intervention would have effect for 18 months and would be subject to administrative and judicial review.ASIC's power to intervene is currently limited to dealing with defective disclosure. Remedies are reserved for fairly extreme cases, such as misleading or deceptive conduct.The Government accepted Financial System Inquiry recommendations that ASIC should have financial product intervention powers and the product issuers and distributors should be held to a higher standard of accountability.The FSI said more needed to be done to ensure alignment of consumer outcomes with commercial incentives through the financial product lifecycle.It argued that reliance on disclosure for consumer protection was inadequate when it came to financial consumers.ASIC's product intervention power would apply to all financial products made available to retail clients, including insurance products, investment products and margin loans, and to credit products regulated under the National Consumer Credit Protection Act.In a set of related reforms, financial product manufacturers would have design and distribution obligations to make sure their products met consumers' needs. Issuers would have to identify appropriate target markets and select distribution channels that are likely to result in products being marketed to the identified target market.Distributors would have to put controls in place to ensure products are sold in accordance with the issuer's expectations.These obligations would cover retail financial products, such as insurance policies, margin loans and derivatives but not to other credit products or ordinary shares.Currently there are no specific design obligations for most products. There is a general obligation for licensed issuers to operate honestly and fairly.An important feature of the reforms is that they will include post-sale product evaluation. There is currently no obligation to monitor products to ensure they continue to meet the needs of consumers.Under the proposed changes product issuers would have to review arrangements "with reasonable frequency" to ensure arrangements continue to be appropriate.The Minister for Revenue and Financial Services, Kelly O'Dwyer, has called for feedback on the proposals. The closing date for submissions is March 15 next year.