ASIC
has done a very, very soft deal with Steve Vizard to face only civil
penalties over allegations of insider trading on three occasions in
2000 when Vizard used his position as a director of Telstra improperly.
Vizard will avoid a criminal conviction and will not go to jail.

Vizard
is a well-connected wealthy and powerful businessman. Today the
Victorian premier, Steve Bracks, gave Vizard his full support as did
Melbourne businessman Ron Walker and (amazingly) the Victorian
opposition leader, Robert Doyle. All this for a man who has admitted to
financially abusing his position as a Telstra director.

The
allegations arose from Vizard’s use of inside information with relation
to three share deals involving Telstra in 2000 – Sausage Software
($500,000 invested), Computershare ($100,000) and Keycorp ($250,000).
ASIC makes no mention of the criminal offence of insider trading
although their summary of facts indicate it was potentially available.

The
public is entitled to ask: why did Vizard get such a good deal? My
guess is that ASIC has decided that it doesn’t have enough evidence to
prove a criminal case beyond reasonable doubt. On the other hand,
Vizard wants to be rid of the risk of going to jail – so the settlement
suits both parties.

But Vizard is a high profile figure who has
admitted to conduct that has the appearance of insider trading while he
was on the board of Telstra. Telstra is a major public company (half
owned by the Government) – it’s a very serious matter that one of its
directors is improperly using information gained as a director for the
financial benefit of himself or others.

Normally ASIC would
compile a brief and send it to the DPP for an opinion as to whether
there is sufficient evidence for a criminal prosecution. The DPP’s
advice in this case must be published. If there is no advice, then it
would be a matter of real concern.

Most citizens would conclude
that if directors of Telstra are crooks, they should be in jail. It’s
hard to avoid the conclusion that Vizard (unlike poor Rivkin) is too
well connected to go to jail.

Peter Faris has acted both for and against ASIC.

Peter Fray

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