Regular news readers and shareholders of Newcrest Mining Limited (ASX: NCM) will be aware that the company has been in court with ASIC nearly a year over allegations of giving market-sensitive information to some shareholders three days before notifying the market of the information.
The shares dropped roughly 15% before the announcement was released to the market at large three days later.
Newcrest admitted fault and settled yesterday with the regulator for a fine of $1.2 million dollars, the largest fine ever given for this kind of misconduct. Although a significant outcome, the fine is little more than pocket change and not likely to act as a significant deterrent.
Fortunately the share price recovered within days and went higher before trending down to its current levels; however Newcrest still has to contend with potential class action lawsuits from disgruntled shareholders. The lawsuit will be conducted by law firm Slater & Gordon Limited (ASX: SGH) and appears to be not unlike the lawsuit conducted against the now defunct Forge Group which is led by Bentham IMF Ltd (ASX: IMF).
It's unfortunate that we live in a world where shareholder interests are protected more by litigation firms rather than the corporate watchdog ASIC, or the ethical obligations of large companies.
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