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Star’s top legal officer has appealed against a major Federal Court judgment that criticised how she handled money laundering risks as the casino’s group general counsel and company secretary.
Paula Maree Martin, the former chief legal officer of the Star Entertainment Group Limited, has appealed against findings that she contravened the Corporations Act 2001 (Cth) by her failure to address money laundering risks from the casino’s then-largest gambling junket, Suncity, and its CEO, Alvin Chau.
The breach also extended to her role in misleading the National Australia Bank (NAB) about the use of UnionPay cards, or CUP, which had been strictly prohibited for use in gambling.
Justice Michael Lee imposed on Martin a seven-year ban from managing corporations and a $400,000 pecuniary penalty.
“The community is entitled to expect that a solicitor occupying such positions and having such responsibilities, within one of Australia’s largest casino operators, will display professional independence, accuracy and judgement of a high order,” Justice Lee said at the time.
In appeal documents lodged with the Federal Court late last week, Martin claimed Justice Lee erred – specifically in three parts of the judgment – by finding a reasonable officer in her position must have informed the board of the money laundering and CUP issues.
Justice Lee found Martin “could not divide her duties and responsibilities between her roles as group general counsel and company secretary”. He said Martin was accountable directly to the board and all directors had “direct access” to her for advice.
“She had weekly meetings with the chairman, attended most, if not all, board meetings, and facilitated the finalisation of several board papers which were presented [to] the board.
“The purpose of her position as group general counsel and company secretary included providing legal advice and assistance to the business and to the broader senior executive teams to ensure business operations were conducted within the limits prescribed by relevant laws and regulations,” Justice Lee said.
In circumstances where Martin was aware the board had not been informed of certain risks, Justice Lee also found a reasonable officer in Martin’s position “ought to have spoken up”.
Martin is seeking that the original proceedings be dismissed and that the Australian Securities and Investments Commission (ASIC) pay the costs of the primary trial proceedings and the appeal proceedings.
In the alternative, Martin is seeking that “any one or two” declarations made by Justice Lee be set aside, that orders relating to her be set aside, and that the appropriate pecuniary penalty and disqualification period be redetermined.
While Martin originally pushed back on ASIC’s requests that she be made to pay a pecuniary penalty of $700,000, Justice Lee’s judgment noted Martin had not contested the disqualification period.
Matthias Bekier, similarly found to have contravened the Corporations Act, filed a longer notice of appeal consisting of 11 grounds, including that Justice Lee erred in rejecting parts of his evidence as to the actions he took on the money laundering risks.
Bekier also claimed Justice Lee erred in finding a reasonable director in his position would have asked for, but contravened the act by not asking for, a copy of all Star’s communications with NAB concerning CUP cards following the receipt of a 2020 warning letter.
If the findings are not overturned on appeal, Bekier has sought to appeal the penalty because Justice Lee “failed properly to apply the parity principle” or otherwise take into consideration the penalties imposed on other Star executives.
