ANZ alleges underhanded tactics and ‘wheeler dealing’ by ACCC, ASIC in cartel case

ANZ says the competition and corporate regulators were “wheeler dealing”, as it fights a landmark criminal cartel case.

ANZ, Citigroup and Deutsche Bank are defending criminal charges relating to alleged cartel activity. Picture: NCA NewsWire/Bianca De Marchi

ANZ has accused the competition and corporate regulators of “wheeler dealing” in the way they drafted JPMorgan as a witness and redacted key parts of communication, as it fights a landmark criminal cartel case against it and two other banks.

Federal Court judge Michael Wigney is set to inspect the redacted sections of the 10 documents in question, to decide whether to allow ANZ, Citigroup and Deutsche Bank access to those parts. In a hearing on Tuesday, JPMorgan and the Australian Securities and Investments Commission argued the redacted documents were covered by the legal rules “without prejudice privilege” and legal professional privilege, meaning they must stay confidential.

The hearing also revealed ASIC in March wrote to JPMorgan, Citigroup and Deutsche to communicate it was not taking enforcement action against them relating to its probe into ANZ’s controversial 2015 capital raising.

The cartel legal battle is set to go to trial in April 2022, as the three banks and six former and current executives defend criminal charges.

The long-running matter relates to an ANZ’s 2015 raising and how the banks worked to manage a shortfall of shares not taken up by investors. The Australian Competition & Consumer Commission lobbed the explosive criminal case in 2018, and fellow bank on the capital raising JPMorgan was granted immunity for its co-operation.

In contention on Tuesday was the redaction of documents covering internal emails and ACCC file notes, files relating to phone calls between ASIC and the competition regulator and communication between JPMorgan’s law firm and the regulators.

Tim Game QC, who is representing ANZ cited documents that suggested the ACCC told ASIC to steer clear of probing the banks’ conduct after the capital raising bookbuild.

“ACCC is reported as saying they want the ASIC to stay away from these transactions, and we say, well with good reason. They don’t want these transactions to be criticised or the subject of the prosecution,” he said.

“It has a sting in this case.”

Mr Game noted an ACCC push to de-prioritise any investigation of insider trading against the raising’s managers JPMorgan, Citigroup and Deutsche.

“This is wheeler dealing between agencies in relation to matters of high importance in respect of a case against us,” he said, adding the defendants were entitled to know what occurred that led to criminal charges.

“It’s plain enough, that in one form or another, the ACCC are engaging on behalf of JPMorgan in their dealings with ASIC and that lawfully, or not, JPMorgan are informing the ACCC about what was going on inside ASIC.”

But ASIC and JPMorgan hit back at those views, telling the court their communications with each other and the ACCC were protected and should be kept confidential.

ASIC, represented by Dr Sue McNicol SC, said: “It would be a very robust court indeed to deny privilege to external counsel’s advice”.

Representing JPMorgan, Vanessa Whittaker SC said the bank and ASIC were not parties to the cartel case, and she argued statements between ASIC and JPMorgan which were conveyed to the ACCC were inadmissable.

Ms Whittaker said JPMorgan would have been “less likely” to communicate with regulators if it knew of a risk of future disclosure in a court.

“The information about the content … occurred within the framework of deep obligations of confidentiality that were consistent with the maintenance of privilege.”

Justice Wigney asked if JPMorgan was concerned the redacted material could be “deployed against” the bank in the future, potentially in separate proceedings.

He said the “elephant in the room” from ANZ’s arguments appeared to be whether a deal was done between the regulators, meaning JPMorgan wasn’t subject to a rigorous ASIC probe.

The banks won an earlier legal argument — heard by another judge — on getting some access to first accounts made by JPMorgan bankers on the ANZ raising.

The case continues.