Watching Australian Securities and Investments Commission chief Tony D'Aloisio flailing around on last night demonstrated ASIC's failure as both a watchdog and regulator, leaving it as just a legal administrator - perhaps all it aspires to be.

On one hand, D'Aloisio denied knowledge that the hedge funds, aided and abetted by investment banks, have circumvented his financial stocks shorting ban, even though he has previously admitted that it's done.

And on the other, he amazingly defended ASIC's reviews of Storm Financial over recent years, reviews that found nothing wrong with that rapacious and centrally-flawed company that has cost Australian investors billions.

But that's just in keeping with the view of an ASIC boss who, despite Storm, Opes, MFS, Westpoint et al, believes the system is working well. It seems that belief stems from ASIC's view of itself as a legal administrator, rather than a watchdog. Asked about the series of failures on his watch, D'Aloisio said:

"These business models may not have worked for commercial reasons, it's a long jump to then suggest that the business models didn't work for legal reasons.''