Newcrest Mining Limited has been ordered to pay an AU$1.2 million penalty for breaching its continuous disclosure obligations under section 674(2) of the Corporations Act.
The penalty follows an almost year-long investigation by ASIC into claims the company selectively briefed a group of investment bank analysts about its expected gold production and capital expenditure for the 2013-14 financial year, which led to the investors having access to market-sensitive information before the rest of the market.
ASIC commenced proceedings against Newcrest in the Federal Court of Australia and the parties filed a joint application for civil penalties to be imposed after Newcrest admitted the contraventions. The Court held that Newcrest twice contravened its continuous disclosure obligations and imposed court ordered penalties for each contravention totalling AU$800,000 and AU$400,000 respectively.
In handing down the judgment, Justice John Middleton remarked that the penalties “reinforce the message that equal access to market sensitive information is paramount in ensuring that markets operate on an informed, and equally informed, basis”.
A class action claim for aggrieved shareholders has also been commenced against Newcrest, alleging that between 13 August 2012 and 6 June 2013 the company engaged in misleading or deceptive conduct by providing production guidance without reasonable grounds