By Ben Sewell -
Snapshot
- ASIC v Bekier is the most important directors’ duties case in a decade, showing how directors and management can be held personally liable when clear money‑laundering and reputational risks are left unaddressed.
- The Court found Star’s CEO and general counsel breached their duty of care by failing to escalate alarming information about junket operators and misleading bank dealings, while non‑executive directors narrowly avoided liability but were sharply criticised for insufficient scrutiny.
- The case is a stark reminder that executives must actively disclose and correct risk, lawyers wearing multiple hats attract heightened obligations, and boards can rely on management only until obvious red flags demand harder questions.
The recently delivered decision in Australian Securities and Investments Commission v Bekier (Liability Judgment) [2026] FCA 196 (‘ASIC v Bekier’) is the most significant corporate governance case of the last decade. As Lee J stated, the case is not one of ‘novelty in legal principle’, but it is significant because all the directors and legal counsel were called to account for apparent complicity in money laundering. The subject was the Star Entertainment Group Ltd (‘Star’) management’s actions of allowing junket operators to behave inappropriately and lying to its bankers. The non-executive directors (‘NEDs‘) were not found to have breached their director’s duties but were criticised for their lack of ‘sustained scrutiny or insistence upon explanation in circumstances where risks were obvious’ (at [1951]).
The judgment is long (nearly 500 pages), largely reflecting the number of defendants, the ‘tsunami’ of documentary evidence and the multiple allegations against each defendant. Thankfully, a generous smattering of literary and historical allusions means the judgment never feels Brobdingnagian, as Lee J might put it.
