A Senate inquiry into penalties for white-collar criminals has heard companies are choosing to hire private consultants and "clean up" claims of fraud, leading to crimes being swept under the rug.

Australian Shareholders' Association director Stephen Mayne said a "cover-up mentality" was rife inside boardrooms.

"The cover-up culture is very strong," he told the inquiry. "Directors are very conscious of reputation ... you don't want to admit anything that could lead to a class action."

He said it was fostered by the belief that Australia's corporate cop – the Australian Securities and Investments Commission – lacked power.

"There's a real sense that the big boys get away with it," he said.

Mark Zirnsak, director of the Justice and International Mission Unit of the Synod of Victoria and Tasmania, told the inquiry that conversations with consultants who carried out internal investigations suggested fraud was common.

"What these firms are saying to us is that they have no shortage of business," he said.

"There's a huge caseload of frauds that take place. So there is a sense that Australia's penalties haven't been adequate."

The Senate standing committees on economics inquiry is tasked with examining the failures of Australia's current criminal and civil penalties for corporate and financial misconduct.

It was set up by Greens senator Peter Whish-Wilson after scandals inside the big banks and a recommendation by the inquiry into the performance of ASIC.

Dr Zirnsak said surveys with businesses suggested the official statistics on white-collar crime activity significantly underestimated the occurrence of fraud.

"A lot of this crime is not being pursued through the justice system but being dealt with internally by companies, and that comes at a cost," he said.

"The conversations seem to indicate that many of their clients would not want the internal fraud made public, they worry about reputation damage and impacts on their business."

ASIC used the hearing to again call for an increase in penalties for white-collar criminals. It said it supported penalties three times the value of gotten gains and an increase in jail times.

It also wants "disgorgement" powers to allow it to force repayment of profits from companies and crooks hauled before courts – something it has never had despite being common in other jurisdictions.

Currently ASIC must instigate separate Proceeds of Crime actions to recoup any winnings of corporate criminals.

ASIC senior executive leader Chris Savundra defended the agency's record in catching corporate crooks, dismissing criticism that it only goes after the "small fish".

"It's about seeking to achieve the best spread of outcomes with the resources we have available," he said.

He said the agency preferred to go after individuals rather than companies so that shareholders would not be affected.

"When we pursue entities, it is ultimately shareholders who pay those fines," he said.