MELBOURNE, AUSTRALIA (March 28, 2 p.m. ET) — Australia's corporate regulator will not investigate whether directors of companies that manufacture Australia's plastic banknotes and market the technology overseas breached their duties over bribery allegations.
The Canberra-based Australian Federal Police (AFP) last year charged two companies — Melbourne-based Securency International Pty. Ltd. and Note Printing Australia Ltd. (NPA) — and six Victorian individuals with bribing foreign public officials.
Melbourne-based Australian Securities & Investments Commission (ASIC) said AFP had handed over material relating to the bribery allegations.
“ASIC has reviewed the material from the AFP for possible directors' duty breaches of the Corporations Act 2001 and decided not to proceed to a formal investigation,” it said in a statement. Under the Corporations Act, company directors or officers must exercise their powers and discharge their duties with care and diligence.
Neither ASIC, AFP nor the Sydney-based Reserve Bank of Australia (RBA), which jointly owns Securency, would comment on ASIC's decision. But an A.F.P. spokesperson said its investigation is on going.
Australian Greens politician Adam Bandt has continued to demand Australian Federal Treasurer Wayne Swan initiate a judicial inquiry into the possible illegality of senior RBA officials and businesses' involvement in the alleged note bribery scandal.
Bandt said only a full, independent inquiry can “clear the shadow that hangs over the RBA”. “The RBA is a key pillar of the country's economic management. It needs to be able to operate free from the shadow that hangs over it because of this scandal.”
In response, Swan's spokesman said the Federal Government will not comment while authorities are investigating the claims and court proceedings are pending.
Securency, a joint venture established in 1996 between RBA and UK-based polymer film manufacturer Innovia Films Ltd., manufactures and markets a biaxially oriented polypropylene (BOPP) polymer substrate used in Australian banknotes since 1988. It has sold the technology to 30 other countries.
NPA, which is wholly owned by the RBA, operates the printing works where Australia's banknotes are printed.
AFP alleged Securency and NPA and the six individuals, who were senior executives with either company, conspired with sales agents in Indonesia, Malaysia and Vietnam to bribe officials to secure contracts to produce polymer banknotes for those countries.
In May 2009, a whistleblower claimed bribes totaling up to US$47.7 million were paid by Securency's foreign agents to sell the polymer banknote technology globally. After the allegations emerged, Securency approached AFP to investigate the claims and engaged accountancy firm KPMG to examine its policies for employing international agents.
In November 2011, RBA and Innovia announced plans to sell Securency, following what the companies claimed is “strong interest” from buyers. But there have been no further announcements on a possible sale since and RBA's spokeswoman will not comment on progress with the sale.