Criminal charges against banking ‘cartels’ show Australia is getting tough on competition law


Barbora Jedlickova, The University of Queensland

A two-year probe by Australia’s consumer watchdog has resulted in criminal charges against ANZ, Citigroup and Deutsche Bank, as well as six of their senior executives, over alleged “cartel-like” behaviour.

The case, brought by the Commonwealth Director of Public Prosecutions (CDPP) after an investigation by the Australian Competition and Consumer Commission (ACCC), is the second prosecution of its kind to be brought in Australia since competition laws were tightened almost a decade ago.




Read more:
Cartel case shows not all corporate misbehaviour goes unpunished


The banks and six investment bankers are charged with cartel conduct related to the sale of A$2.5 billion worth of unsold ANZ shares to investors in August 2015. The ACCC alleges that senior executives from the three banks colluded in the way they dealt with these shares.

The exact details of the alleged criminal conduct will only become clear at a Sydney court hearing on July 3, 2018.

What is cartel behaviour?

Cartels are forms of anti-competitive conduct where cartel participants decide to stop competing and start colluding. Australian civil law has banned cartels for decades. But the practice only became a criminal offence in 2010. Only its serious forms are subject to criminal law; civil law still governs the rest.

Cartels can take different forms. In the most common instance, participants collude by setting their prices. Other forms include: output restrictions; dividing markets among cartel participants on mutually agreed terms; and bid-rigging, in which a commercial contract is decided in advance but other operators put in sham bids to give the appearance of competition.

There is one primary reason why businesses or executives would stop competing and start colluding: profit. In short, cartel participants cheat to get more money, creating higher prices and lower output in the process. This disadvantages consumers, the economy and society at large.

But proving criminal collusion in a court is harder than it might seem.

Beyond reasonable doubt

Although we need to wait for the case to unfold to find out more, what we can tell at this stage is that the ACCC and the CDPP perceive the alleged conduct as serious enough for it to constitute a criminal case. Criminal cases are harder to prove than civil cases. Cartel collusion must be proved beyond reasonable doubt, and the evidence has to show that the individuals involved knew (or believed) that they were colluding.

What these charges also show is that the ACCC and the CDPP are prepared to go after the most powerful corporations and their executives for alleged cartel-like conduct. This is an enormously important step for deterrence, because criminal charges are naturally more attention-grabbing than civil lawsuits.

Charging high-ranking bank executives will potentially make the deterrent more effective still, because high-ranking executives set the cultural tone for their organisations.

Research has shown that significant prison time – or the threat of it – for individuals is a more effective deterrent than civil penalties; especially if the penalties are not high enough, as was argued in the recent OECD report on corporate penalties for cartels in Australia. The report showed that the penalties applied in Australia were low in comparison with competition law regimes in the European Union and the United States.

Just the beginning?

This is the second Australian criminal case of cartel conduct – the first involved a Japanese company shipping cars to Australia. We can reasonably expect more of these kinds of charges in the future, given that the laws are only eight years old and investigations of this type typically take years to reach fruition. (The alleged cartel conduct in the latest case took place in August 2015, almost three years ago.)

There are differences in investigation procedures between criminal and civil cases, to ensure that collected pieces of evidence are admissible in a criminal proceeding. It is ultimately the CDPP’s (and not the ACCC’s) decision whether or not to prosecute.




Read more:
Cartels caught ripping off Australian consumers should be hit with bigger fines


The final step is for criminal proceedings to be prosecuted. The first cartel criminal case, which concerned the shipping industry, can be perceived as successful, with two global shipping companies pleading guilty.

It is still early days for Australia in terms of tracking down and punishing examples of cartel behaviour via criminal prosecutions. But the latest developments suggest that Australia is prepared to follow the example of the world leader in successful cartel-related criminal prosecutions: the United States.

The US criminal regime is one of the oldest in the world, having existed since 1890. The US boom of cartel-related criminal cases began in the late 1990s with the lysine cartel and the vitamin cartel and with the first foreign national being sentenced to imprisonment in July 1999. One of the first criminal cartel investigations inspired the production of the 2009 movie The Informant!.

The ConversationThe numbers further illustrate the success of the US criminal prosecutions. For instance, 27 corporations and 82 individuals were charged in the fiscal year 2011. Australia has a long way to go before it can match those numbers.

Barbora Jedlickova, Lecturer, School of Law, The University of Queensland

This article was originally published on The Conversation. Read the original article.

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The first charges over Russian involvement in the US election have been laid – are there more to come?



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Special Counsel Robert Mueller (centre) has laid the first charges from his investigation into Russian interference in the 2016 US presidential election.
Reuters/Aaron Bernstein

Sandeep Gopalan, Deakin University

Special Counsel Robert Mueller has issued an indictment outlining charges against the Internet Research Agency LLC (and two related entities which had “various Russian government contracts”) and 13 Russian individuals. The defendants are charged with:

knowingly and intentionally conspiring with each other (and with persons known and unknown to the Grand Jury) to defraud the United States by impairing, obstructing, and defeating the lawful functions of the government through fraud and deceit for the purpose of interfering with the US political and electoral processes, including the presidential election of 2016.

The defendants, posing as activists, allegedly created “false personas” and fake accounts to operate social media accounts and pages on divisive social issues. The indictment does not specifically state that the individual defendants were connected to the Russian government, although at least one of them is known to be close to Putin. Specific to the 2016 election, the defendants’ goal was “supporting” the campaigns of Donald Trump and Bernie Sanders, and “disparaging” Hillary Clinton.

Their activities were not merely online. They gathered intelligence, staged rallies posing as Americans (in New York, Pennsylvania, Florida) and “communicated with unwitting individuals associated with the Trump campaign.”

Some of their efforts were effective. For instance, the fake Twitter account “Tennessee GOP”, which falsely claimed to be operated by the Republican Party in that state, attracted 100,000 followers.




Read more:
Explainer: what is a special counsel and what will he investigate in the Trump administration?


The indictment lists political advertisements taken out by the defendants. These included such messages as “Donald wants to defeat terrorism … Hillary wants to sponsor it”, “Ohio Wants Hillary 4 Prison”, and “Hillary is a Satan, and her crimes and lies had proved just how evil she is.”

Their tactics were insidious. They targeted vulnerable groups such as African-Americans and Muslims to sow hate and reduce Clinton’s turnout.

The indictment provides rich detail about the Russian agency: it was incorporated in 2013, based in St Petersburg, employed hundreds of people for its online work, and had a budget of millions. It described its work as “information warfare” against the US and wanted to “spread distrust towards the candidates and the political system in general” during the 2016 election. Again, no direct link to the Russian government or Putin is mentioned in relation to these actions.

It is alleged the company and the named individuals conspired to violate the Foreign Agent Registration Act, which stipulates certain informational requirements for agents of foreign principals who attempt to influence US public opinion, policy and legislation. They also violated the Federal Election Campaign Act, which prohibits foreigners from making contributions etc relating to electioneering communications. The indictment also alleges identity theft, bank and wire fraud, and violations of visa laws.

Crucially, the indictment does not state that the Trump campaign colluded with the Russians. It clearly notes that any contact with the campaign was “unwitting”.

Deputy Attorney-General Rod Rosenstein also clarified there was no allegation of collusion in the indictment and he stated that the Russians did not affect the outcome of the 2016 election. Following the indictment, President Trump has tweeted that his campaign “did nothing wrong – no collusion!”

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The president has also tweeted:

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This marks an important step for Trump. He is now apparently dismissing Russian influence after repeatedly refusing to condemn them, seeking to downplay their involvement in the election, and labelling it a hoax.

He has since pointed out that the indictment shows Russian involvement began in 2014 – before he entered the campaign. Moreover, the evidence shows that the Russians did not support only Trump. They also supported Bernie Sanders (who has blamed the Obama Administration for not doing more to tackle it), although this fact has not been adequately covered in the media. Further, the goal of the Russians was to sow distrust in the political system and undermine the electoral process – not specifically to help Trump.




Read more:
US approach to security is deeply troubling – and it’s not just about Trump


Does the indictment mean that the president and members of his campaign are in the clear? The answer is difficult to determine at this stage. The indictment leaves open the question as to whether other US individuals might have aided the defendants.

Subsequent actions by Mueller might bring forward additional charges against Trump or his team. Further, the indictment does nothing in relation to the potential obstruction-of-justice case against Trump, although the evidence on this is likely to be weak.

The ConversationFinally, from a purely political standpoint, it is hard to see from the evidence outlined that the Russian involvement was decisive. To be sure, they propped up fringe groups and spread discord, which local groups were fully capable of doing and did throughout the election. In addition, the sums of money documented in the indictment are small change in the context of the gargantuan amounts both campaigns spent during the 2016 campaign.

Sandeep Gopalan, Professor of Law, Deakin University

This article was originally published on The Conversation. Read the original article.

Australian Politics: 14 July 2013


With the return of Kevin Rudd as Prime Minister in Australia, things have been moving along fairly quickly in Australian politics. Time of course is running out as an election looms, so time is necessarily of the essence. One of the areas that the ALP has moved to address is the carbon tax, with Kevin Rudd’s government moving toward an emissions trading scheme. This has brought the typical and expected responses from the opposition, as well as charges of hypocrisy from the Greens. For more visit the following links:

http://www.smh.com.au/federal-politics/political-news/kevin-rudd-confirms-government-to-scrap-fixed-carbon-price-20130714-2pxqi.html

The link below is to an article that pretty much sums up the situation currently in Australian politics I think – well worth a read.

For more visit:
http://www.guardian.co.uk/world/2013/jul/12/tony-abbott-fall-stunt-men

Also causing continuing angst in Australia is the issue of asylum seekers and boat people. There has been even more terrible news from the seas surrounding Christmas Island, with yet another asylum seeker tragedy involving a boat from Indonesia.

Around the edges of the mainstream parties are those of Bob Katter and Clive Palmer. There are stories of an alleged financial offer from Clive Palmer’s ‘Palmer United Party’ to join with ‘Katter’s Australian Party’ for $20 million dollars and form the combined ‘Katter United Australian Party.’ For more visit the links below:

http://www.news.com.au/breaking-news/national/palmer-denies-deal-with-katters-party/story-e6frfku9-1226679175607
http://www.abc.net.au/news/2013-07-14/katter2c-palmer-at-odds-over-claims-mining-magnate-offered-fin/4819098

And finally, for just a bit of a chuckle – not much of one – just a small chuckle, have a read of the following article linked to at:

http://www.perthnow.com.au/news/turnbull-still-not-laughing-at-tonys-internet-humour/story-fnii5s3z-1226679169349

Iran: Latest Persecution News


The link below is to an article reporting on an Iranian pastor who has been held in prison for several years and further charges he may yet face.

For more visit:
http://www.christiantelegraph.com/issue16782.html

Latest Persecution News – 12 June 2012


Victims of Explosion in Israel Lament Plea Agreement

The following article reports on the latest news of persecution in Israel, where an extremist Jew is facing charges following the bombing of a pastor’s home.

http://www.compassdirect.org/english/country/israel/article_1571127.html

 

The articles linked to above are by Compass Direct News and  relate to persecution of Christians around the world. Please keep in mind that the definition of ‘Christian’ used by Compass Direct News is inclusive of some that would not be included in a definition of Christian that I would use or would be used by other Reformed Christians. The articles do however present an indication of persecution being faced by Christians around the world.

Latest Persecution News – 11 May 2012


Egyptian Judge Frees Attackers Who Knifed Christian

The following article reports on the latest news of persecution in Egypt, where Salafi Muslims who attacked a man, cutting of his ear in an attempt to force him to convert, have had all charges dismissed.

http://www.compassdirect.org/english/country/egypt/article_1532636.html

 

The articles linked to above are by Compass Direct News and  relate to persecution of Christians around the world. Please keep in mind that the definition of ‘Christian’ used by Compass Direct News is inclusive of some that would not be included in a definition of Christian that I would use or would be used by other Reformed Christians. The articles do however present an indication of persecution being faced by Christians around the world.

Pakistan: Bible Facing Ban


Islamists in Pakistan are pushing for the Bible to be banned because they say it denigrates Islamic prophets.

Read the article at:
http://www.christianpost.com/news/now-bible-faces-blasphemy-charges-in-pakistan-50789/

 

Persecution News: What was Missed While on My Break – Part 1


The following are articles from Compass Direct News from the period I was on my break:

 

Detained Pakistani Christian Released – But Two Others Held


Christian falsely accused of ‘blasphemy’ taken into custody, released – and detained again.

LAHORE, Pakistan, April 18 (CDN) — A Christian illegally detained in Faisalabad on false blasphemy charges was freed last night, while two other Christians in Gujranwala arrested on similar charges on Friday (April 15) were also released – until pressure from irate mullahs led police to detain them anew, sources said.

Masih and his family have relocated to a safe area, but just 10 days after he was falsely accused of desecrating the Quran in Faisalabad district of Punjab Province on April 5, in Gujranwala Mushtaq Gill and his son Farrukh Mushtaq were taken into “protective custody” on charges that the younger man had desecrated Islam’s holy book and blasphemed the religion’s prophet, Muhammad. A police official told Compass the charges were false.

Gill, an administrative employee of the Christian Technical Training Centre (CTTC) in Gujranwala in his late 60s, was resting when a Muslim mob gathered outside his home in Aziz Colony, Jinnah Road, Gujranwala, and began shouting slogans against the family. They accused his son, a business graduate working in the National Bank of Pakistan as a welfare officer and father of a little girl, of desecrating the Quran and blaspheming Muhammad.

The purported evidence against Farrukh were some burnt pages of the Quran and a handwritten note, allegedly in Farrukh’s handwriting, claiming that he had desecrated Islam’s holy book and used derogatory language against Muhammad. A Muslim youth allegedly found the pages and note outside the Gills’ residence.

Inspector Muhammad Nadeem Maalik, station house officer of the Jinnah Road police station, admitted that the charges against the accused were baseless.

“The initial investigation of the incident shows Mr. Gill and his son Farrukh are innocent,” he told Compass.

The two were kept at a safe-house, instead of the police station, out of fear that Islamist extremists might attack them; their subsequent release led to Islamic protests that compelled police to detain them anew today, sources said.

Despite police admitting that the two Christians were not guilty, a First Information Report (No. 171/2011) was registered against them under Sections 295-B and C in Jinnah Road Police Station early on Saturday (April 16).

“Yes, we have registered an FIR of the incident, yet we have sealed it until the completion of the investigation,” Inspector Maalik said, adding that the police had yet to formally arrest Gill and his son. “We registered the FIR for their own safety, otherwise the mob would have become extremely violent and things could have gone out of control.”

The police official said that after the Muslim youth made the accusation, he gathered area Muslims together.

“It seems to be a well thought-out scheme, because the perpetrators chose the time of the Friday prayers for carrying out their plan,” Maalik said. “They were sure that this news would spread quickly, and within no time people would come out of the mosques and react to the situation.”

He added that police were now inquiring of the Gills why they might suspect anyone of wanting to harm them.

“We are also looking for any signs of jealousy or old enmity,” Maalik said.

Soon after the Muslim youth found the alleged pages, announcements blared from the area’s mosques informing Muslims about the incident and asking them to gather at the “crime scene,” sources said.

There are about 300 Christian families residing in Aziz Colony, and news of the alleged desecration spread like jungle fire. Announcements from mosques sparked fear in the already shaken Christian families, and they started packing their things to leave the area, fearing the kind of carnage that ravaged Gojra on Aug. 1, 2009, killing at least seven Christians.

“It’s true…the news of the accusations against Gill and his son and the announcements being made from the mosque calling on Muslims to avenge the desecration sent shivers down our spines,” said Pastor Philip Dutt, who has known the Gill family for several years and lives in the same neighborhood. “The charges are completely baseless. I’m sure no person in his right frame of mind would even think of committing such a vile act. Someone has clearly conspired against the Gill family.”

He added that most of the area’s Christians had left their homes overnight, fearing an attack by Muslims.

Dutt said that a large police contingent arrived in time and took Gill and his son into custody after assuring the enraged mob that a case under the blasphemy laws would be registered against the two men. Police remained stationed in the area to provide protection to area Christians, but the atmosphere was tense.

According to some reports, a group of angry Muslims wanted to torch Gill’s house, but timely police intervention thwarted their plan.

At the same time, a group of Muslim extremists stormed into the house of Anwar Masih, a Christian factory owner in Aziz Colony, and started beating him and his son, sources said. The family managed to save themselves by calling the police and now they too are in “protective custody.”

The Rev. Arif Siraj, moderator of the Presbyterian Church of Pakistan, which also oversees the functioning of the Christian Technical Training Centre in Gujranwala, said the accusations against Farrukh were yet another example of how the country’s blasphemy laws are misused against innocent people.

“We have been engaged with the police and local Muslim leaders throughout the day to resolve this issue amicably,” Siraj said. “An eight-member committee comprising six Muslims and two Christian pastors has been formed to probe the incident, and they will make a report on Friday.”

The names of the Christians of the eight-member committee are Pastor Sharif Alam of Presbyterian Church Ghakarmandi and the Rev. Joseph Julius.

A large number of Muslims, including members of religious parties and banned outfits, came out to the roads of Gujranwala on Saturday (April 16) to protest the alleged desecration of the Quran and pressure police to take action against Gill and his son. The protestors reportedly gelled into one large demonstration on Church Road and headed towards the CTTC. Siraj said that some participants threw stones at a church on the road, but that Muslim elders immediately halted the stone-throwing.

“The district administration and Muslim leaders have now assured us that no one will target Christian churches and institutions,” he said, adding that both communities were now waiting for the committee’s report.

Sohail Johnson of Sharing Life Ministry expressed concern over the accusations.

“This case is a classic example of how Christians and Muslims continue to be charged with blasphemy on false accusations,” he said. “Isn’t it ridiculous that the accuser is claiming that Farrukh has confessed to burning the Quran in his note and thrown the burnt pages in front of his house – what sane person would even think of saying anything against prophet Muhammad in a country where passions run so deep?”

Arif Masih, the falsely accused Christian released last night, has reportedly been relocated along with this family to a safe location.

The original blasphemy law, introduced in British India in 1860, imposed a prison term of up to two years for any damage to a place of worship or sacred object carried out “with the intention of thereby insulting the religion of any class of persons or with the knowledge that any class of persons is likely to consider such destruction, damage or defilement as an insult to their religion…”

The current provision in the Pakistan Penal Code, as amended in 1986, introduces both the death penalty for insulting Muhammad and drops the concept of intent. According to Section 295-C of the Penal Code, “Whoever by words, either spoken or written, or by visible representation, or by any imputation, innuendo, or insinuation, directly or indirectly defiles the sacred name of the Holy Prophet Muhammad (peace be upon him) shall be punished with death, or imprisonment for life and shall also
be liable to fine.”

The laws have drawn condemnation across the world, and two senior government officials – Punjab Gov. Salman Taseer, a liberal Muslim, and Federal Minister for Minorities Shahbaz Bhatti, a Christian, have been assassinated this year for demanding a review of the legislation.

Report from Compass Direct News
http://www.compassdirect.org