Some of Australia's top bankers from ANZ, Deutsche Bank and Citigroup Global Markets have been committed for trial on criminal cartel charges.
The banks and executives John McLean, Rick Moscati, Michael Ormaechea, Michael Richardson, Stephen Roberts and Itay Tuchman were committed from the NSW Local Court on Tuesday.
The upcoming trial will be heard in the Federal Court and will relate to criminal breaches of Australian consumer law.
This case has a long, complex history — starting with a two-year investigation by the competition watchdog, the Australian Competition and Consumer Commission (ACCC), and resulting in criminal charges brought by the Commonwealth Director of Public Prosecutions.
The corporate regulator ASIC also sued ANZ in relation to the alleged cartel conduct, as part of a separate lawsuit.
Those proceedings have been halted pending the outcome of the case brought by the ACCC.
The criminal charges relate to ANZ issuing an extra $2.5 billion worth of shares, in August 2015, which it sold to institutional investors.
The banks and executives have denied the allegations and have been defending the proceedings since 2018.
Alleged collusion about how to deal with excess shares
The sale was organised and underwritten by Citigroup, Deutsche Bank and a third major global bank, JP Morgan, to boost ANZ's balance sheet in accordance with demands from the bank regulator APRA.
As is normal in these so-called share placements, the underwriters agreed to buy any shares that other investors did not want.
Often, there aren't any left over — but this time almost a third of the shares, worth about $790 million, didn't sell.
That left the three big investment banks with a chunk of ANZ shares they would eventually need to offload.
The allegation made by the ACCC is that the three investment banks and ANZ, through some of their most senior executives, came to an understanding about how these shares were to be dealt with.
JP Morgan is not facing charges because it blew the whistle and was granted immunity.
For companies, the maximum fine for each criminal cartel offence is either $10 million, or three times the total benefits that have been earned and are "reasonably attributable" to the commission of the offence (whichever is greater).
If the total value of the benefits cannot be determined, then the maximum penalty is 10 per cent of the company's annual turnover connected with Australia.
For individuals, the maximum sentence is 10 years' imprisonment, a fine of up to $420,000, or both.
