ASIC v Lindberg: A Landmark Penalty Judgment for Breaching Corporations Act

ASIC V LINDBERG
[2012] VSC 332
(Student Details: )
Business and Corporation Law

Introduction
 Landmark penalty judgment handed by the Supreme
Court Judge of Victoria, Robson J, on 09th Aug, 2012.
 ASIC, initiated legal proceedings against Andrew
Lindberg.
 Lindberg was previous managing director of the
company AWB Limited.
 ASIC made a claim that Lindberg had not fulfilled the
duties contained in the Corporations Act, 2001.
 Penalty judgment was given by the court after the
decision was made to settle down the proceedings (Jade,
2017).
 Due to the breaching the provisions of governing
commonwealth act, the judgment restated the
pecuniary penalties and the disqualification order
imposition (Jacobson, 2012a).

ASIC v Lindberg
 Highly publicized case where the allegations were laid against the
violations which were undertaken by the company AWB.
 These were carried for the resolutions of United Nations, herein
referred to as UN, which were undertaken with Iraq. The
resolution called on the UN’s member states, for preventing the
sale of any kind of commodity to Iraq and this had some
exceptions, drawn from humanitarian basis and the exception
included food material.
 An attempt was made through this resolution to deny the hard
currency to the regime of Iraq.
 Oil for Food Program, herein referred to as OFP, had the
responsibility of undertaking the sanction which led to the
proceeds from the sale of petroleum products of Iraq being placed
under the UN’s escrow account.
 The release of funds from this account was only allowed for the
commodities which were permitted, including the food material. A
 WB was a huge supplier of wheat to Iraq as per the OFP (Austlii,

ASIC v Lindberg
 Two key matters on the basis of which the violation of
the UN resolution had been claimed.
 First Matter:
 Related to the 10% payment made as being the trucking
fee which was related to the contracts of wheat
undertaken with Alia.
 Alia was an intermediary company which was passing on
this fee to the Iraqi government and so, the hard currency
was obtained by the government.
 This was in addition to the fact that the payment being
received by AWB was designed in a manner so as to
reimburse such payments.
 Hence, through this entire transaction, the money held in
the UN escrow account was being made use for such
purposes which were restricted under it (Austin and
Reynolds, 2012).