Login
High Court decision a ‘game changer’ for corporate fraudsters
Those behind predatory business models may be held liable after a High Court’s landmark decision on corporate wrongdoing.
Naomi Neilson
The High Court’s decision in Productivity Partners v ACCC opened the door for corporate wrongdoers to be penalised for implementing “knowing and deliberate” strategies designed to prey on people, Professor Elise Bant from the University of Melbourne said.
Marketers were recruited to sign up students for online courses with promises of free laptops and other gifts.
While originally, they weeded out students who did not want to study, this was abandoned when recruiters complained about losing money.
It meant students, many from disadvantaged backgrounds, were saddled with “substantial debt” for courses they did not start.
Justice Michelle Gordon and Justice James Edelman used a model, developed by Bant, that identified the “blameworthiness of organisations as responsible entitles in their own right”.
Bant said it was a “practical way of unmasking corporate and predatory practices”.
She said catching fraudsters was previously impossible, with the law demanding evidence that a particular person was responsible.
That “traditional principle” was akin to a game of Where’s Wally?, except the complex business models, natural and corporate-third party agents, and teams of employees meant Wally “is often nowhere to be found”, Bant explained.
“That meant that many corporate wrongdoers have, in the past, escaped scot-free,” she said.
Not only could the decision extend to “every aspect” of corporate wrongdoing, but Bant said it may also apply to government entities, “so public entities could be held to account for systemic abuses such as robodebt”.
“The High Court’s decision is a game changer. It explains that corporations ‘think through their systems’ and that this college’s processes and practices proved its intentions,” she said.
Naomi Neilson
Naomi Neilson is a senior journalist with a focus on court reporting for Lawyers Weekly.
You can email Naomi at:
