Law firm Slater & Gordon is leading a group of investors who are suing a subsidiary of Macquarie Bank for more than $10 million.
A statement of claim against Macquarie Equities Limited was filed in the Federal Court of Australia, NSW District Registry today.
A consortium of international investors is suing the wholly owned subsidiary of Macquarie Bank as a result of market manipulation of shares in the electronic pre-paid bill payment technology company, Bill Express.
In 2007 the consortium, made up of Al Othman Holding Co and Voice & Data Telecommunication Co formed a joint venture, Ipay Express, and invested more than $9.5 million in Bill Express and its parent company, OnQ Group Limited.
Between August 2007 and March 2008 Macquarie Equities Limited made representations to the joint venture about the value of Bill Express and brokered the sale of large tranches of shares in Bill Express to the joint venture, via a broker employed by Macquarie Equities.
Slater & Gordon claims that at the same time the broker was engaged in illegal trading of Bill Express stock which had the effect of propping up the company’s share price.
In May 2008 Bill Express and OnQ were suspended from the ASX and both companies are now in liquidation.
Vicky Antzoulatos, Commercial & Project Litigation lawyer at Slater & Gordon, said it is alleged that by reason of the broker’s conduct, Macquarie engaged in market manipulation in breach of the Corporations Act.
“Our clients are seeking to establish that Macquarie, the holder of the Australian Financial Services licence under which the broker operated, is responsible for his illegal behaviour,” Antzoulatos said.
“Macquarie must be held accountable for the necessary compensation to our clients," she said.
The consortium is also alleging the conduct of Macquarie was misleading and deceptive and in breach of the Corporations Act 2001.