In the matter of Macquarie Securities (Australia) Limited [2026] NSWSC 202, the Supreme Court of New South Wales (Nixon J) made agreed declarations of contravention of the Corporations Act 2001 (Cth) and imposed agreed pecuniary penalties in the total amount of $35 million against Macquarie Securities (Australia) Limited (MSAL).
The case concerned MSAL’s admitted misreporting to the ASX of at least 73 million short sales between 11 December 2009 and 14 February 2024, and its admitted misreporting of regulatory data to the ASX between 16 November 2022 and 21 March 2023. ASIC estimates that MSAL misreported between 298 million and 1.5 billion short sales during a more than 14-year period.
ASIC and MSAL agreed, and the Court declared, that MSAL’s conduct amounted to:
- three separate contraventions of s 798H(1)(b) of the Corporations Act, which requires participants in licensed markets to comply with the market integrity rules, including the requirements to have appropriate supervisory policies and procedures, to have and maintain necessary organisational and technical resources, and to report required regulatory data;
- one contravention of s 912A(1)(h) of the Corporations Act, which requires financial services licensees to have adequate risk management systems; and
- one contravention of s 1041H of the Corporations Act, which requires that persons must not engage in misleading or deceptive conduct in relation to a financial product.
Nixon J held that the parties’ agreed facts established that there were serious deficiencies in the systems, processes and controls MSAL had in place which were directed to complying with its short sale and regulatory data reporting obligations, and those deficiencies gave rise to the admitted contraventions: [182]. His Honour recorded MSAL’s admission that its short sale reporting process as a whole, which involved multiple IT systems, was not fit for purpose during the contravention period (at [184]) and noted that this was a serious deficiency which was contrary to the requirements of MSAL’s own internal policies (at [185]).
His Honour held that inaccurate short sale data undermines the purpose of the 2009 reform which introduced the short sale reporting obligations, and undermines confidence in Australia’s financial markets: at [196]. Further, his Honour agreed with the parties’ joint submission that accurate short sale data is important for the efficient operation of the ASX and the Cboe Australia market, and may be used and relied upon by several categories of individuals and entities who make decisions on the assumption that the data is accurate and reliable: at [194].
His Honour concluded that the parties’ proposed $35 million total penalty was proportionate to the gravity of MSAL’s contraventions, and was just and appropriate: at [226].
The case is the first Australian decision concerning short sale reporting.
Luke Livingston SC, Amy Reid and Nicholas Carey appeared for ASIC, instructed by Gadens.
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