Court orders ASIC to hand over investigative notes, summaries in insider trading case

A court has told ASIC it must hand over key parts of its investigation into Duncan Stewart, who faces multiple charges of insider trading.

Duncan Stewart outside court with his barrister Ruth Shann. Picture: Angelica Snowden

The Australian Securities and Investments Commission has been told by a court to hand over investigative notes, agenda task lists and summaries in a case against a man charged with multiple counts of insider trading linked with a $776m takeover deal.

Duncan Stewart faced a committal mention hearing at the Melbourne Magistrates Court on Monday, after ASIC alleged he made $68,000 when he purchased shares in lithium group Kidman Resources with inside information regarding a proposal from Wesfarmers to acquire the company before plans were announced to the market.

Wesfarmers acquired Kidman Resources in September 2019 in a deal worth $776m, and was subsequently delisted from the ASX and is now known as Australian Light Minerals Pty Ltd.

When the deal was first announced to the market on May 2, 2019 the share price of Kidman Resources jumped from $1.29 to $1.84.

ASIC alleged Mr Stewart engaged in insider trading two times in April 2019, when he first bought the shares.

It further claims he “procured” another person to commit insider trading two times in March and April 2019, by encouraging a family member to buy Kidman Resources shares.

Mr Stewart’s barrister Ruth Shann SC told the court the Commonwealth Director of Public Prosecutions, which is prosecuting the case on behalf of ASIC, objected to her request for investigative notes, agenda task lists and summaries taken by investigators.

“(The case was first) investigated in 2019. Charges were laid in the last few months. It cannot seriously be contended it is irrelevant for Mr Stewart (to access these items),” she said.

“What has taken the CDPP and ASIC so long? We want to see and know what ASIC has done and not done and why.”

Ms Shann also said they wanted to find out if anyone else had bought the shares, and that other people had been named by ASIC but not charged.

Senior federal prosecutor for the CDPP, Szara Isaacs, told the court some of the correspondence requested by Mr Stewart and the scope of his legal team’s request was “too broad”.

In response, the magistrate said the request had to be broad because they “don’t know what is there” and said the material should be disclosed.

“Disclosure is critical to enable (the) defence to properly understand the basis on which charges have been laid,” she said.

The magistrate ordered a “proper disclosure” application, before Ms Shann also asked for recordings of compulsory examinations conducted with other people in relation to the investigation, all documents compulsorily obtained by ASIC related to people or companies related to Mr Stewart. She also asked for search terms for Mr Stewart’s devices seized in the investigation and urged for clarity on whether or not the investigation has concluded, or if it is still ongoing.