In the near-decade since, he's watched the regulator cop harsh criticism as retail investors lost billions of dollars from a string of corporate and investment collapses after the global financial crisis.

Giving explosive evidence in the recent Senate inquiry that lambasted ASIC's performance, Wheeldon accused the regulator of allowing policy decisions to be unduly influenced by lobby groups.

And now, with ASIC poised to be stripped of tens of millions of dollars in funding, Wheeldon fears the budget cuts will leave the agency more vulnerable to industry demands, making Australia's burgeoning financial sector - and the millions of Australians whose life savings are entrusted within it - even more exposed to scandals and misconduct.

"If you get a reputation for being captive of industry and beholden to industry ... you can't shake it," he says.

Few government agencies have been hit as hard by budget cuts as those tasked with keeping corporate Australia in line.

The government is pressing ahead with cuts that experts warn will severely impact the regulators' ability to do their jobs, despite recent scandals involving financial advice - such as at the Commonwealth Bank - and allegations of large-scale tax dodging by multinationals.

Thousands of jobs will go from ASIC and the Australian Tax Office over the next four years as the government slashes more than $260 million from the two agencies.

It follows an overall decline in funding to ASIC over several years, despite its ever-expanding mandate.

The banking regulator, the Australian Prudential Regulation Authority, will also feel the pinch. Despite its role watching over Australia's almost $2 trillion in retirement funds, it will be required to pay an increased efficiency dividend to the government.

As world leaders talk up the need for economic reform at the G20 in Brisbane this weekend, calling for more resilience against future shocks, regulators have been left lamenting slashed budgets and reduced staff.

Consumer groups are worried. "If regulators aren't sufficiently funded, there's a real risk misconduct will occur and go unremedied," warns Gerard Brody, of the Consumer Action Law Centre.

Now business groups - the very target of watchdog scrutiny - are joining them in expressing their own concern about having regulators that are unable to do the job.

"A good, strong corporate regulator actually assists everyone to know what their compliance obligations are," says Judith Fox, the national director of the Governance Institute - the mouthpiece for company secretaries.

"You get less confusion and ambiguity. For companies, that's better."

The cuts come as the key financial agencies struggle under the burden of greater responsibilities, including tax crackdowns and greater oversight of the stock market - some of the very issues being touted at this weekend's summit.

Wheeldon, who now represents companies being investigated by ASIC, says greater funding alone won't fix ASIC's problems - but is the first step in improving enforcement.

"You need to recruit good, aggressive people who have the experience to know where the loopholes are and where people will cut corners," he says. "There's no cheap and easy way to do it."

The annual reports of Australia's corporate watchdogs, tabled in Parliament last week, lay bare the state of the regulators' coffers.

ASIC, one of the hardest hit, with $120 million to go over four years, has been forced to cut staff in all of its focus areas, except financial advice - the industry that has been undermined by a series of scandals at some of Australia's largest financial institutions.

Teams as small as 20 or 30 people will now be left at the regulator to pore over the activities of some of the biggest sectors of the economy, including superannuation and investment banking.

The Tax Office's annual report highlights equally alarming numbers. It has already seen 3000 staff exit this year and will have another 1700 leave under Abbott government cuts.

This is despite growing evidence that Australian companies and multinationals operating in Australia are shifting profits overseas to reduce their tax - seriously eroding the country's corporate tax base.

Cuts to major agencies have triggered fear from consumer groups as well as the regulators themselves.

ASIC chairman Greg Medcraft made his concerns loud and clear last month when he said Australia was a "paradise" for white-collar crime.

He has since withdrawn the comments after being reprimanded by finance minister Mathias Cormann, but says proactive corporate surveillance will be "substantially reduced" due to cuts.

"My warning is that people will need to be careful. Take responsibility for yourself," he told a Senate estimates hearing in June.

The consumer watchdog, the Australian Competition and Consumer Commission, also made its concerns known to government in its report last week.

The agency has been spared from severe cuts, with a funding boost of $68.5 million over four years, however this is largely tied to the monitoring of prices related to the repeal of the carbon tax.

ACCC chairman Rod Sims said the regulator had undertaken a series of measures to ensure it could continue to provide high-quality outcomes, despite "operating with significantly fewer resources".

This week APRA Member Helen Rowell said that choosing where to allocate resources was now one of the greatest hurdles for regulators.

"There is a real challenge for the regulatory agencies around balancing funding and resourcing, and what we do with those resources," she told a conference in Melbourne.

"It's not going to get any easier, it's going to get harder."

Ms Rowell says the only option for organisations is to become "more flexible" with resources.

"The expectations on us and what we can do are perhaps unrealistic, in many respects, so we need to get much better at making careful decisions about priorities and what we do and where we focus."

Flexibility is one word for it, but Wheeldon has others. He says despite the many hardworking individuals inside ASIC, its funding drain could leave regulators more vulnerable to the demands of lobby groups and less able to uphold the best interests of the public.

"The industry lays down the law for ASIC. They tell ASIC: 'this is how it's going to be, you better do it, and if you don't, there will be consequences, because we are politically connected'," he says.

Wheeldon's evidence to the inquiry included allegations that ASIC bowed to pressure from a lobby group over online calculators, and held regular "industry liaison meetings" on the issue.

But ASIC has played down Wheeldon's testimony, and his former role at the regulator. ASIC told the inquiry he was a "junior lawyer" who worked for ASIC for just nine months in 2004-2005.

ASIC's annual report reveals that while funding has been cut, meetings with stakeholder groups have ballooned.

So-called stakeholder engagement is now a core part of what the regulator does, with a total of 685 meetings held with industry throughout the past year.

In its investment bank division alone, it held 284 meetings with industry groups - more than one every working day. This compared to 22 a year earlier - a 1200 per cent increase.

Andrew Eastwood, a partner at law firm Herbert Smith Freehills who also represents companies being investigated by ASIC, says far from letting companies run wild, cuts to the regulator can have serious negative consequences for businesses, such as delayed enforcement, bungled investigations and increased uncertainty.

"Business wants the corporate regulator to apply the laws in an efficient, fair, and consistent manner," he says.

"Certainty and speed are important, as is a level playing field. But those things are hard to achieve if the regulator is not adequately funded."

Much of ASIC's funding over recent years has been tied to specific projects.

Under former treasurer Wayne Swan's 2009-10 budget, the watchdog was given enhanced monitoring and enforcement capabilities in the wake of the global financial crisis. This consisted of an additional $15 million over the four years to 2012-13.

The regulator was also given $18 million in additional "global recession" funding.

But overall, the regulator's funding has declined over the past few years and is now below 2010 levels, according to annual reports.

Fox says funding to ASIC has not kept up with its burgeoning mandate.

"ASIC's responsibilities have expanded significantly," she says. "It's no longer just a corporate regulator, it's a regulatory conglomerate that covers not only companies, markets, finance industry supervision but insurance, superannuation, credit markets, margin lending and business names."

She says this expanding mandate, combined with a decline in funding, leaves the door open to wrongdoing.

"There's the concern the market surveillance program will be less focused," she says. "Things do go wrong. You want to know whether they went wrong because people didn't know their obligations or they deliberately broke the law."

The regulator has been dealt a further blow to its enforcement ability, with the government's amendments to data retention laws meaning it will no longer be one of the agencies given access to telecommunications metadata - a crucial weapon in the fight against white-collar criminals, particularly insider traders.

Medcraft is understood to have written to Attorney-General George Brandis to express concern about the amendments, saying they could weaken the regulator as a white-collar crimebuster.

Meanwhile, APRA's funding situation is also prompting concern from business. Unlike ASIC, APRA already receives some of its income from industry.

Over recent years, it has been subject to an "efficiency dividend" under which the government has reduced funding to drive efficiency savings. The dividend has been increased under this year's budget.

The agency said in its submission to the financial system inquiry that continued efficiency dividends would "ultimately compromise financial safety" and make no contribution to the government's budget objectives.

Fox says APRA's increased efficiency dividend had alarmed business.

"That's the fourth largest pool of money in the world, so prudential regulation is getting more important, not less," she says. "I don't think anyone really expected to see that."

Total government revenue for APRA has fallen in the 2013-2014 financial year to $111 million, from $116 million a year earlier, according to annual reports.

Along with the agencies, the government departments themselves are also being downsized - with one in three full-time positions at Treasury to be eliminated by 2016-17, from the peak of just over 1000 in 2011.

The Community and Public Sector Union, which represents workers at various government agencies and departments, says ASIC in particular has suffered from successive budget cuts spanning decades.

It says budgetary pressures have affected its ability to attract, retain and train staff and to keep up with the best technology for surveillance and enforcement activities.

And this has occurred in an environment of expanding responsibilities, including into ASX regulation, national credit regulation and national and business names registration, it says.

"What it means is that there aren't nearly as many regulators on the look-out to protect the Australian community," Alistair Waters, the deputy national president of the CPSU says.

"This government does not appear interested in providing the resources to protect the Australian public from shonky operators."

Cormann says the government is confident that ASIC has the "appropriate resources to fulfil its statutory responsibilities".

"The allocation of ASIC's funding across its priorities is a matter for ASIC as an independent regulator," he added.

The silver-bullet solution being touted for ASIC budget cuts is for the industry to fund its own regulation. This would involve a switch to a user-pays model, where companies pay a levy to the regulator responsible for policing them.

Medcraft has repeatedly called for such a system, which would relieve him from the whims of fiscal policy.

"Such a model is not about increasing ASIC's budget but about providing the economic incentives to drive the government's desired regulatory outcomes for the financial system," he says.

The model was one of the key recommendations in a 553-page report by a Senate inquiry into the performance of ASIC and has widespread support from both consumer and business groups.

However, the government has delayed any decision about ASIC funding until the Financial System Inquiry reports later this month. Cormann says he is considering the proposal.

Nationals senator John Williams says the system should be introduced as soon as possible, to allow ASIC to get on with the job of policing the financial planning industry in the wake of high-profile scandals at CBA and Macquarie Bank.

"These licence [fees] should be brought forward to start on the first of July next year," he said last month.

ASIC deputy chairman Peter Kell told Fairfax Media a user-pays system would provide "a more sustainable and accountable model" for ASIC's funding.

He admitted that companies were being forced to self-regulate more.

"The participants in the financial sector have to step up to the mark in identifying problems both within their own firms, but also more broadly across the industry," he said.

"You have to get on the front foot about identifying your own problems, rectifying them, putting consumers into the best position and making sure if you see other problems in the industry, you tell us about it."

For Wheeldon, this type of thinking sets a dangerous precedent - and begins with a lack of resources.

"The message from the federal government is very clear, that the return Australia is getting from investment in ASIC isn't good enough," he says.

"It's a vote of no confidence, cutting funding like that. It's ultimately very short-sighted."