Labor Senator Deb O’Neill calls on ASIC, Macquarie to come clean on Nuix failures

Labor Senator Deb O’Neill has launched a stinging attack on ASIC and Macquarie for the failures that led to the rout of tech darling Nuix.

Labor Senator Deborah O'Neill said Macquarie needed to disclose its role in the initial public offering of Nuix shares late last year. Picture: AAP

Labor senator Deb O‘Neill has launched a salvo at investment bank Macquarie Group and the corporate regulator over the destruction of shareholder capital following savage profit warnings from Macquarie-backed tech darling Nuix.

Senator O’Neill called on the Australian Securities & Investments Commission to come clean on the Nuix saga when it appears before parliament on August 27.

Senator O’Neill, who sits on the joint committee on corporations and financial services, said Macquarie needed to disclose its role in the initial public offering of Nuix shares late last year.

“While I respect Macquarie wanting to maintain confidentiality and legal professional privilege, I am concerned that there is a misunderstanding of the role of parliament to get to the truth of matters that impact Australians,” she said.

She said a string of profit warnings by Nuix amounting to a $3bn loss of revenue “is a bigger concern to me as a senator than the legal privilege and confidentiality for a bank”.

Her comments comes as Macquarie chief executive Shemara Wikramanayake last week defended the bank’s role in steering Nuix to last year’s listing.

Speaking on the sidelines of the bank’s annual general meeting last Thursday, Ms Wikramanayake said Nuix had come to market with a “robust” prospectus. Macquarie still owns a 30 per cent stake in Nuix.

“At the time none of us had any reason to believe that the prospectus forecasts at the time of float would not be met,” she said.

“We remain confident in the medium-term prospects of this high-quality business and ­product.”

ASIC is investigating Nuix’s former chief financial officer Stephen Doyle for alleged insider trading in the company’s shares and his role in allegedly misstating the company’s accounts.

An affidavit of ASIC senior lawyer Jenny Truong shows the regulator is investigating “whether Stephen Doyle gave to the ASX or permitted to be given to the ASX, a prospectus including information about the forecast revenue of Nuix for the financial year ending 30 June 2021 that was false or misleading”.

ASIC is also investigating whether Nuix’s IPO prospectus, lodged with the regulator and the ASX, “contained false or misleading information”.

ASIC commissioner Cathie Armour has recused herself from the Nuix investigation.

However, ASIC commissioner Cathie Armour recently stepped aside from the regulator’s investigations into Nuix after her connections to Macquarie were aired in parliament.

Ms Armour previously worked alongside Macquarie Capital’s Dan Phillips, who also sits on Nuix’s board.

Senator O’Neill said ASIC’s assurance’s that enough time had passed between Ms Armour’s role at Macquarie and her investigations into Nuix was “not good enough”. “I say as the peak regulator for Australian financial services that standard is not good enough. ASIC must have, and be perceived to have, the highest standards,” she said.

“Following ASIC’s line of reasoning, if ASIC has determined a significant amount of time has passed so as not to create a perceived conflict of interest, when will it ever be OK for the Australian public to know the truth? Never? Not good enough in my view.”

Senator O’Neill said an “urgent and independent review of protocols around conflict of interest and regulatory capture at ASIC needs to be established” in response to the failures around Nuix’s market listing.

“This messy and costly matter has revealed a standard I am not willing to overlook. Questions need to be answered,” she said.

“At the end of the day let’s be very clear about this Nuix matter: a whistleblower contacted ASIC no fewer than three times about the Nuix IPO listing raising the alarm … no alarm bells went off, the listing was activated and $3bn has been lost to investors.”