| | | Effective PR

Australia's DPP withdraws bank cartel case.

BIScom Subsection: 
Editorial Staff

The Commonwealth Director of Public Prosecutions (CDPP) has today withdrawn charges against Citigroup Global Markets Australia Pty Limited (Citigroup), Deutsche Bank AG and four senior banking executives.

The case alleged that there was a criminal cartel arising from an ANZ institutional share placement in August 2015. This decision was made in accordance with the Prosecution Policy of the Commonwealth, the DPP said in a statement.

In June 2018, a media release said

Citigroup Global Markets Australia Pty Limited (Citigroup), Deutsche Bank Aktiengesellschaft (Deutsche Bank) and Australia and New Zealand Banking Group Ltd (ANZ) have been charged with criminal cartel offences following an investigation by the ACCC.

Criminal charges have also been laid against several senior executives: John McLean, Itay Tuchman and Stephen Roberts of Citigroup; Michael Ormaechea and Michael Richardson formerly of Deutsche Bank; and Rick Moscati of ANZ.

The charges involve alleged cartel arrangements relating to trading in ANZ shares held by Deutsche Bank and Citigroup. ANZ and each of the individuals are alleged to have been knowingly concerned in some or all of the alleged conduct.

The cartel conduct is alleged to have taken place following an ANZ institutional share placement in August 2015.

“These serious charges are the result of an ACCC investigation that has been running for more than two years,” ACCC Chairman Rod Sims said.

“Charges have now been laid by the Commonwealth Director of Public Prosecutions and the matter will be determined by the Court.”

The matter is listed before the Downing Centre Local Court in Sydney on 3 July 2018.

The Competition and Consumer Act requires any trial of such offences to proceed by way of indictment in the Federal Court of Australia or a State or Territory Supreme Court.

As this is a criminal matter currently before the Court, the ACCC will not be providing further comment at this time."

The circumstances became known as a result of the actions of an informant as part of a deal for his own immunity.

This conduct was investigated by the ACCC and in mid-2017 was referred to the CDPP, who decided to bring criminal cartel charges. The ACCC was made aware of the conduct through an immunity application by another party involved in the conduct.

“We respect the independent decision of the CDPP, and with them will consider what lessons can be learnt from this matter,” ACCC Chairman Rod Sims said.

“Cartel conduct involves businesses acting together instead of competing fairly with each other. We considered that the alleged conduct stood to damage competition and the Australian economy. That is why the ACCC investigated this conduct and referred the evidence to the CDPP. The Office of the CDPP assessed the evidence very carefully and, as required by law, made an independent decision to prosecute based at all times on an application of the Prosecution Policy of the Commonwealth.”

“When competition is impeded, this usually results in increased prices for other businesses and consumers, and the ACCC will take action when it has reason to believe businesses are acting anti-competitively,” Mr Sims said.

“While there can be challenges involved in bringing criminal cartel prosecutions, particularly due to the complexity of the cartel laws, we will continue our efforts to deter, detect and dismantle cartels, and will continue to refer serious cartel conduct to the CDPP for its consideration. That is our role and we will continue to fulfil it, even though not all briefs of evidence given to the CDPP will result in the laying of charges or convictions.”

“There have been five successful criminal prosecutions of cartel conduct affecting Australian consumers, following ACCC investigations and CDPP prosecution under criminal cartel laws which came into effect in 2009. These include three convictions in cases against international shipping lines with penalties totalling AUD83.5 million, and guilty pleas by individuals in two recent cases in the pharmaceutical and money remittance sectors,” Mr Sims said.

“There are also a number of criminal cartel prosecutions and civil cartel cases currently before the courts or with the CDPP for consideration.”

All those named have had charges against them withdrawn.

---------------- Advertising ----------------