The credibility of a lawyer employed by the corporate regulator has come under intense scrutiny in the Victorian Supreme Court after lawyers for former AWB chief executive Andrew Lindberg accused the Australian Securities and Investments Commission of acting with "sinister" intent.
As the regulator's troubled civil penalty case against Mr Lindberg lurched into ever more complicated territory, ASIC's instructing lawyer, Martin Lockett, was hauled into the witness box for almost four hours of cross-examination yesterday.
Mr Lockett was asked repeatedly by Mr Lindberg's counsel, David Collins, SC, why ASIC apparently believed it could pursue allegations against Mr Lindberg that related to events after March 2003 when Justice Ross Robson in September ruled that the fall of Saddam Hussein was a cut-off date.
Mr Lockett said that during a pre-trial hearing on October 5, two weeks before ASIC's case against Mr Lindberg began, certain comments by Justice Robson led ASIC to believe that the March 2003 date was "up in the air" or that the judge might be "open" to the idea of letting ASIC raise the allegations during the trial.
Mr Lockett said Justice Robson's written reasons in September and his comments in early October were "in some respects inconsistent", and ASIC still expected there would be "argy-bargy" during the trial about which alleged breaches could be pursued.
The court also heard yesterday that ASIC's board of commissioners has decided to appeal a recent decision in which Justice Robson refused to allow ASIC to run a second civil penalty case against Mr Lindberg. The Court of Appeal this morning is expected to set a timetable for hearing the appeal in early February.
ASIC has accused Mr Lindberg of breaching his fiduciary duties, arguing he knew or ought to have known about $US225 million of kickbacks that AWB, for at least four years, paid to the corrupt regime of Saddam Hussein in breach of UN sanctions against Iraq.
ASIC's second civil penalty case, which was filed after the first trial began, alleges Mr Lindberg misled AWB's board and failed to inform fellow directors about the extent of AWB's internal investigation dubbed Project Rose, which has been discredited as a ruse to cover up the kickbacks, the Tigris transaction, and the gravity of the allegations against AWB that were being investigated by the UN's Volcker inquiry.
ASIC yesterday applied to the court to amend its original statement of claim against Mr Lindberg. Its proposed amendments, if allowed, effectively would set new deadlines for when certain fiduciary duties are deemed to have expired.
But ASIC continues to argue that Mr Lindberg's duty to investigate allegations about the kickbacks or to raise the alarm extended from when he joined the company in early 2000 until he quit in February 2006.
The hearing continues today and Justice Robson has indicated he wants the trial in the first civil penalty case to resume on January 25.
THE credibility of a lawyer employed by the corporate regulator has come under intense scrutiny in the Victorian Supreme Court after lawyers for former AWB chief executive Andrew Lindberg accused the Australian Securities and Investments Commission of acting with "sinister" intent.
As the regulator's troubled civil penalty case against Mr Lindberg lurched into ever more complicated territory, ASIC's instructing lawyer, Martin Lockett, was hauled into the witness box for almost four hours of cross-examination yesterday.
Mr Lockett was asked repeatedly by Mr Lindberg's counsel, David Collins, SC, why ASIC apparently believed it could pursue allegations against Mr Lindberg that related to events after March 2003 when Justice Ross Robson in September ruled that the fall of Saddam Hussein was a cut-off date.
Mr Lockett said that during a pre-trial hearing on October 5, two weeks before ASIC's case against Mr Lindberg began, certain comments by Justice Robson led ASIC to believe that the March 2003 date was "up in the air" or that the judge might be "open" to the idea of letting ASIC raise the allegations during the trial.
Mr Lockett said Justice Robson's written reasons in September and his comments in early October were "in some respects inconsistent", and ASIC still expected there would be "argy-bargy" during the trial about which alleged breaches could be pursued.
The court also heard yesterday that ASIC's board of commissioners has decided to appeal a recent decision in which Justice Robson refused to allow ASIC to run a second civil penalty case against Mr Lindberg. The Court of Appeal this morning is expected to set a timetable for hearing the appeal in early February.
ASIC has accused Mr Lindberg of breaching his fiduciary duties, arguing he knew or ought to have known about $US225 million of kickbacks that AWB, for at least four years, paid to the corrupt regime of Saddam Hussein in breach of UN sanctions against Iraq.
ASIC's second civil penalty case, which was filed after the first trial began, alleges Mr Lindberg misled AWB's board and failed to inform fellow directors about the extent of AWB's internal investigation dubbed Project Rose, which has been discredited as a ruse to cover up the kickbacks, the Tigris transaction, and the gravity of the allegations against AWB that were being investigated by the UN's Volcker inquiry.
ASIC yesterday applied to the court to amend its original statement of claim against Mr Lindberg. Its proposed amendments, if allowed, effectively would set new deadlines for when certain fiduciary duties are deemed to have expired.
But ASIC continues to argue that Mr Lindberg's duty to investigate allegations about the kickbacks or to raise the alarm extended from when he joined the company in early 2000 until he quit in February 2006.
The hearing continues today and Justice Robson has indicated he wants the trial in the first civil penalty case to resume on January 25.
Email a friend