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The Federal Court has handed down some of the largest penalties ever for corporate misconduct.
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Former GetSwift directors hit with millions in fines
17 February 2023
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The Federal Court has thumped two former directors of software company GetSwift with millions in fines in some of the largest penalties ever handed down for corporate misconduct.
GetSwift former director, CEO and executive chairman Bane Hunter was fined $2 million and disqualified from managing corporations for 15 years while former director – and former AFL star – Joel Macdonald was fined $1 million and disqualified for 12 years.
The company itself, which sprung from an alcohol delivery business in 2015 and was listed on the ASX until 2021, was ordered to pay $15 million while another former director, Brett Eagle, was fined $75,000 and was disqualified from managing corporations for two years.
The court described GetSwift as the “unacceptable face of start-up capitalism” and said it “became a market darling because it adopted an unlawful public-relations-driven approach to corporate disclosure instigated and driven by those wielding power within the company”.
Justice Lee found Mr Hunter “had a laser-like focus on making money for himself and Mr Macdonald and if that involved breaking the law regulating financial markets, or exposing GetSwift to third party liability, that was of little concern to him”.
He said Mr Macdonald was focused on making money and had “little understanding or regard for his legal obligations as a director”.
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The ruling yesterday in Australian Securities and Investments Commission v GetSwift Limited (Penalty Hearing) [2023] FCA 100 follows a finding in November 2021 that GetSwift made numerous misleading statements in its announcements on ASX and breached its continuous disclosure obligations on 22 occasions between February and December 2017.
Mr Hunter, Mr Macdonald and Mr Eagle were found to have misled the market and were knowingly concerned in GetSwift’s continuous disclosure breaches. As a consequence, they breached their duties as directors.
In the wake of that finding GetSwift relocated to North America and was listed on the Canadian Neo exchange before being suspended and placed in liquidation last July.
GetSwift, Mr Hunter, Mr Macdonald and Mr Eagle have also been ordered to pay ASIC’s costs.
ASIC deputy chair Sarah Court said: “Disclosure is critical to market integrity and consumer protection. The penalties imposed by the court demonstrate the extent and seriousness of the misconduct in this matter and the importance placed by the court on deterring others from engaging in similar behaviour.”
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