Plan for Federal Court to hear ASIC criminal trials faces criticism

The Attorney-General’s Portfolio Miscellaneous Measures Bill 2023, which was referred to the Legal and Constitutional Affairs Legislation Committee on 30 November 2023, would “confer jurisdiction on the Federal Court of Australia to hear and determine a range of summary and indictable offences relating to conduct within the regulatory remit of the Australian Securities and Investments Commission (ASIC)”.

In the reading of the Attorney-General’s Portfolio Miscellaneous Measures Bill 2023, Attorney-General Mark Dreyfus said amendments within the bill would enhance the court system to allow it to not only deal with more corporate offences but also assist with prosecutions brought by ASIC.

This is linked to its response to the banking royal commission, in which it said extending the Federal Court’s jurisdiction “will boost the overall capacity within the court system to ensure the prosecution of financial crimes does not face delays as a result of heavy caseloads”.

As part of the overall plan, the government has provided an additional $70.1 million to boost ASIC’s enforcement activity and $41.6 million to the Commonwealth Director of Public Prosecutions to prosecute an increased number of briefs received from ASIC.

In a submission to the Senate legal and constitutional affairs legislation committee, ASIC said it “strongly supports the introduction of the bill”, also referencing the royal commission’s emphasis that “effective deterrence through judicial decisions relies on the timely institution of proceedings and punishment of misconduct”.

The corporate regulator pointed to the “considerable expertise” of the Federal Court in civil commercial matters, namely the 154 proceedings that ASIC has commenced before the Federal Court in the last four financial years.

This, ASIC said, makes the court “well-positioned to accommodate the conferral of a greater corporate criminal jurisdiction and therefore to increase the speed with which such matters are dealt with”.

“Contraventions of the civil penalty provisions regularly heard by the Court also often attract criminal penalties. Currently ASIC must pursue criminal contraventions in the State and Territory courts,” it said in its submission.

“ASIC’s experience is that State and Territory courts must necessarily prioritise the listing of trials of defendants who are in custody awaiting trial, which is uncommon in ASIC’s criminal matters.

“Further, ASIC’s financial crime prosecutions are often complex and document heavy requiring longer trial listings than is necessary for other crime types. These two factors alone can cause lengthy wait times for trial listings in ASIC’s criminal matters in addition to the heavy case load of the State and Territory courts.”

Needs more work

The Law Council of Australia (LCA), on the other hand, said that although the government’s proposal to introduce ASIC criminal trials to the Federal Court is good in theory, there is not enough clarification to justify such a “significant change”.

“Any such changes necessitate detailed justification, which the Law Council is concerned has not sufficiently occurred to date, especially without visibility of the Attorney-General Department’s submission to the committee,” the LCA submission read.

The Law Council has proposed a number of recommendations to strengthen the bill, including requests for further clarification on some of its rationale, particularly “given delays in prosecuting criminal corporate crime are not dependent on jurisdiction”.

The LCA said it understands from constituent bodies that delays arise due to “extensive documentary evidence” and because the matters are of such “high complexity” that it will include ongoing investigations and “multiple tranches of brief service”.

It has also requested clarification on how the bill proposes to manage existing constraints on the court’s exercise of the criminal jurisdiction and asked for further information on how it intends to allow the court to transfer proceedings across the Australian court system.

The submission went on to outline concerns with the judges of the Federal Court, acknowledging while some will have “significant experience” in federal criminal law, “the reality is that a significant portion of Federal Court judges will have limited experience”.

“The Law Council is concerned there may be insufficient numbers of Federal Court judges with experience running complex criminal trials in every superior court registry, particularly in Adelaide, Brisbane and Perth,” it added in the submission.

This would also be a concern when an appeal will be required, as it would likely “lead to a very small number of trial judges sitting in judgment of each other’s rulings and directions”.