ASIC hits ANZ with charges over a $2.5 billion fund raising in 2015

ASIC alleges ANZ's fund raising broke the law.

ASIC alleges ANZ's fund raising broke the law. Photo: AAP

Regulator ASIC has added to ANZ’s woes over a $2.5 billion 2015 share placement, launching legal action for breaches of continuous disclosure rules about the fund raising.

ASIC alleges ANZ broke the rules on continuous disclosure by not telling the Australian Securities Exchange the full story about how the raising was financed.

The ACCC launched anti-cartel proceedings on the issue in June, alleging ANZ and the two merchant banks who underwrote the deal, Deutsche and Citigroup, engaged in cartel behaviour in August 2015 over the funding of the deal.

“ASIC alleges that ANZ contravened s.674(2) of the Corporations Act by failing to notify the Australian Securities Exchange that approximately $791 million of the $2.5 billion of ANZ shares offered in the placement was to be acquired by its underwriters rather than placed with investors,” it said.

The ACCC action shocked the financial world by taking criminal action against the executives involved, as well as the banks. Criminal charges were laid against John McLean, Itay Tuchman and Stephen Roberts of Citigroup; Michael Ormaechea and Michael Richardson formerly of Deutsche Bank; and Rick Moscati of ANZ.

ANZ said it will defend both ASIC’s and the ACCC’s allegations, claiming its actions did not amount to market rigging and that it was not required to release the details to the market.

“The shares in question represented less than 1 per cent of the shares on issue at the time, and were taken up by the joint lead managers in circumstances where the book indicated the placement was covered at 103 per cent,” it said in a statement.

“ANZ is not aware of a precedent for a listed entity to disclose the take-up of shares by underwriters in an equity placement.

ANZ chief risk officer Kevin Corbally said: “ANZ’s disclosure in relation to the placement was in accordance with its ASX disclosure obligations, as well as market practice, and we are defending the matter,.”

ANZ shares were up marginally to $28.18 on Friday afternoon.

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