Federal Court approves $20.5 million penalty for ASX Ltd over misleading statement on tech upgrade project
The Federal Court has approved a $20.5 million penalty handed to ASX Ltd over a misleading statement about the status of a critical technology project.
The Federal Court has approved a $20.5 million penalty handed to ASX Ltd over a misleading statement about the status of a critical technology project.
The Australian Securities and Investments Commission launched action against the share market operator in August 2024 after it stated in February 2022 that its Clearing House Electronic Sub-register System (CHESS) upgrade was “progressing well”.
But it was not on ASX Ltd’s “critical path” to go live in April 2023 as planned, and had for months been internally classified “red’, indicating significant unresolved issues or risks.
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By continuing you agree to our Terms and Privacy Policy.ASX Ltd announced in May 2022 that the delivery date was no longer viable and stopped the project later that year.
Last month, it admitted the misleading statement, heading off an ASIC-brought trial.
Federal Court Justice Brigitte Markovic approved the penalty on Friday.
“I am satisfied that the declarations should be made in the form jointly proposed by ASIC and ASX and that a pecuniary penalty order should be made in the aggregate sum of $20.5 million,” she ruled.
“The parties have agreed that ASX should pay ASIC’s costs of the proceeding in the agreed amount of $3 million. This is an amount less that ASIC’s actual costs of the proceeding.”
After the admission, ASX chair David Clarke apologised in a statement, saying the new CHESS project was “now on firmer footing”.
The first release, handling clearing services, was delivered just two months ago while the second stage, which will handle settlement activities, is targeted for delivery in 2029.
