False or misleading statements

Offence title:

False or misleading statements

Act:

1041E Corporations Act

Offence:

(1)   A person must not (whether in this jurisdiction or elsewhere) make a statement, or disseminate information, if:

(a)   the statement or information is false in a material particular or is materially misleading; and

(b)   the statement to information is likely:

                                           i.         induce persons, in this jurisdiction, to apply for financial products; or

                                         ii.         induce persons, in this jurisdiction, to dispose of or acquire for financial products; or

                                        iii.         to cause increases, reductions, maintenance or stabilisation of the price for trading in financial products in a financial market in this jurisdiction; and

(c)    when the statement or dissemination of information is made, the person:

                                           i.         does not care whether the statement of information is true or false; or

                                         ii.         the person knew or ought reasonable to have known, the statement or information is false in a material particular or is materially misleading.

Note: Failure to comply with this subsection is an offence: s. 1311(1).

Note: Failure to comply with this subsection is a contravention: s.1317E and 1317S.

(2)   For the purposes of the application of the Criminal Code in relation to an offence based on subsection (1), paragraph (1)(a) is a physical element, the fault element for which is as specified in paragraph (1)(c).

(3)   For the purposes of an offence based on subsection (1), strict liability applies to subparagraphs (1)(b)(i), (ii) and (iii).

Penalty:

15 years imprisonment

Summary/Indictable/mixed:

Indictable

Jurisdiction:

District or Supreme Court

How committed:

An environmentalist protester sends a false press release to the media in which a bank allegedly withdraws its loans to a paper mill. The media publishes the press release which in turn, induces shareholders to sell their shares causing a fall in value. When sending out the press release the protester knew it was entirely false.

Important note:

Defence: For defences to a prosecution based on this section, see Division 4 - Defences, relief and limits on liability: s.1044A General defence or relief for publishers and 1044B Limit on liability for misleading or deceptive conduct.