Justice Michael Lee had a clear message for the director class in his ASIC v Star Entertainment judgment: don’t complain you have too much information. Do something about it.
ASIC pursued 11 Star directors and executives over alleged failures to manage risks linked to money laundering and criminal groups from 2017 to 2019, issues that ultimately led to the group losing its licence to operate Sydney’s casino.
Lee ruled that only the then CEO, Matt Bekier, and Star’s chief lawyer, Paula Martin, had breached their duties under section 180 of the Corporations Act, finding ASIC had not made out its case against the others because of “the distortion of hindsight”. (The two other executives settled before trial.)
That didn’t mean the seven non-executive directors escaped Lee’s lash.
He noted that, in 2011, fellow Federal Court judge John Middleton had warned in the Centro case (ASIC v Healey) that boards should control the volume of information they consider and stop arguing about it.
