ACCC head of enforcement Marcus Bezzi concedes it’s a ‘live issue’ that investment banks accused of criminal cartel conduct could mount a joint venture defence.

The charges alleged they engaged in a cartel over a Friday-to-Monday period in August 2015 with four phone calls to discuss the capital raising that fell short, leaving a third of the shares in the hands of underwriters.
JPMorgan was also an underwriter to the raising but was granted immunity by the ACCC for confessing to the behaviour and co-operating with the regulator’s investigation.
Defence lawyers have used a series of committal hearings to examine how the ACCC constructed its case and gathered material, and significant time has been devoted to probing how key witness statements had changed over numerous drafting exercises.
In one instance, key JPMorgan witness Jeff Herbert-Smith in an early draft statement had appeared to contend the underwriting investment banks had each agreed separately and independently to refrain from selling more than between 5 and 7 per cent of the leftover ANZ shares in a single day.
Tim Game, SC, of Forbes Chambers, is acting on behalf of ANZ. Peter Rae
Under examination at the Penrith Local Court on Wednesday, Mr Bezzi rebuked ANZ’s barrister, Tim Game, and said the proposition that the ACCC was “standing over” witnesses as a “warning” to other bankers was one that he would “totally reject”.
“That could not be further from the truth,” Mr Bezzi said.
Mr Bezzi shot back at Mr Game’s suggestion that Mr Herbert-Smith and his colleague Mark Dewar had denied there was ever an agreement between the investment banks on how to deal with the ANZ shortfall.
“This whole issue is a bit of a furphy,” Mr Bezzi said. “Its contextually relevant but its not much more than that. Its a characterisation of what happened,” he said.
Mr Bezzi said there was a “significant” shortfall in the raising, and that the alleged agreement to refrain from selling more than between 5 and 7 per cent of shares was made to address the risks stemming from the shortfall.
“They believed they had a significant commercial problem and a significant economic problem and that’s why they took the actions that they did, and you know that,” Mr Bezzi told Mr Game.
Mr Bezzi said attempts by JPMorgan to claim that the behaviour did not constitute cartel conduct at the same time as it attempted to gain immunity from prosecution over the matter was a sign the investment bank “wanted to walk both sides of the street”.
The executives charged are Citigroups former Australia head Stephen Roberts, Citi executives John McLean and Itay Tuchman, the former country head of Deutsche, Michael Ormaechea, former Deutsche executive Michael Richardson, and ANZs then group treasurer, now executive, Rick Moscati. All are defending the charges.
The case continues, and ACCC general manager Leah Won is expected to face examination on Thursday.