Newcrest Mining fined by ASIC – what shareholders need to know

Preferential treatment of some shareholders over others is not new, but this time it’s being punished.

| More on:

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

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.

Shareholders must be quite careful with who they decide to trust as ultimately, most of the entities you deal with are guided by financial self-interest. Here at The Motley Fool, however, we place your interests on par with our own – not least because we have our own money invested in our recommendations. The Economist even wrote that:

“The Motley Fool stands out as an ethical oasis in an area that is fast becoming a home to charlatans.”

TMF regularly contacts companies to protect the views of retail shareholders, who so often have no one to voice their complaints at unfair treatment by corporations.

Companies with open, honest management teams whose interests align with shareholders get a big tick in our books, and our latest recommendation is one such organisation.

Besides a responsible management team, this small company also boasts record profits and a fast growing, fully-franked dividend. You can receive this report for FREE by signing up to our free newsletter Take Stock – it takes only 30 seconds and is packed full of useful market insights. Sign up for it here.

Motley Fool contributor Sean O'Neill doesn't own shares in any company mentioned.

More on ⏸️ Investing

Close up of baby looking puzzled
Retail Shares

What has happened to the Baby Bunting (ASX:BBN) share price this year?

It's been a volatile year so far for the Aussie nursery retailer. We take a closer look

Read more »

woman holds sign saying 'we need change' at climate change protest

3 ASX ETFs that invest in companies fighting climate change

If you want to shift some of your investments into more ethical companies, exchange-traded funds can offer a good option

Read more »

a jewellery store attendant stands at a cabinet displaying opulent necklaces and earrings featuring diamonds and precious stones.
⏸️ Investing

The Michael Hill (ASX: MHJ) share price poised for growth

Investors will be keeping an eye on the Michael Hill International Limited (ASX: MHJ) share price today. The keen interest…

Read more »

ASX shares buy unstoppable asx share price represented by man in superman cape pointing skyward
⏸️ Investing

The Atomos (ASX:AMS) share price is up 15% in a week

The Atomos (ASX: AMS) share price has surged 15% this week. Let's look at what's ahead as the company build…

Read more »

asx share price competitions represented by businessmen arm wrestling
Retail Shares

How does the Temple & Webster (ASX:TPW) share price stack up against Nick Scali (ASX:NCK)?

How does the Temple & Webster (ASX: TPW) share price stack up against rival furniture retailer Nick Scali Limited (ASX:…

Read more »

A medical researcher works on a bichip, indicating share price movement in ASX tech companies
Healthcare Shares

The Aroa (ASX:ARX) share price has surged 60% since its IPO

The Aroa (ASX:ARX) share price has surged 60% since the Polynovo (ASX: PNV) competitor listed on the ASX in July.…

Read more »

asx investor daydreaming about US shares
⏸️ How to Invest

How to buy US shares from Australia right now

If you have been wondering how to buy US shares from Australia to gain exposure from the highly topical market,…

Read more »

person reading news on mobile phone
⏸️ Investing

Why Fox (NASDAQ:FOX) might hurt News Corp (ASX:NWS) shareholders

News Corporation (ASX: NWS) might be facing some existential threats from its American cousins over the riots on 6 January

Read more »