Australian Securities watchdog loses insider-trading case against Citigroup


The Australian Securities and Investments Commission now faces being ordered to pay Citigroup's legal costs. The trial was the first time the particular conflict-of-interest law had been tested in Australia.

ASIC's case surrounded Citigroup trader Andrew Manchee, who had bought more than a million Patrick shares the day before Toll was due to announce its takeover of Patrick. On a cigarette break with Citigroup head of equities Paul Darwell, he was told to stop buying Patrick shares. Manchee then proceeded to sell 200,000 Patrick shares late that afternoon.

Justice Peter Jacobsen said the claim failed because Manchee was not an 'officer' of Citigroup within the meaning of the Corporations Act. "His knowledge was therefore not attributable to Citigroup for the purposes of the insider-trading provision," Jacobsen said.

ASIC's other claims, that Citigroup had breached its fiduciary relationship with Toll by trading in shares of the company it was attempting to acquire, and an argument that it had engaged in a conflict of interest, were also dismissed.

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact or view our subscription options here:

You are currently unable to copy this content. Please contact to find out more.

You need to sign in to use this feature. If you don’t have a account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here