The Downing Centre Local Court issued the fine to Societe Generale Securities Australia Pty Ltd (SSGAPL) after four charges brought by ASIC, which the group plead guilty to earlier in the year.
The court’s magistrate said there was a need for “general deterrence” despite SSGAPL having demonstrated improvements made in its procedures since the breaches.
“Australia, in recent years, has had a banking royal commission and there has been action taken post that royal commission, and what is apparent is that a very strong message has to be sent about the need for companies to comply with legislation and regulation,” Magistrate Atkinson said.
SGSAPL was sentenced in relation to two counts of breaching s993B(1) of the Corporations Act by receiving client money in connection with financial services but failing to deposit that money into an Australian authorised deposit-taking institution or an approved foreign bank.
These charges related to transactions taking place between 2014 and 2017 when approximately $771 million worth of client funds were withdrawn and transferred into foreign accounts which were not held with approved banks.
The other two counts involved withdrawal of approximately $497 million from client segregated accounts as part of the group’s margin call process between 2017 and 2018, and the withdrawal of approximately $144,000 in fees and charges between 2015 and 2016.
SSGAPL was found to have breached s993C(1) of the Corporations Act through these counts, by making payments out of a client money account that were not permitted by regulations 7.8.02 of the Corporations Regulations.
ASIC also imposed additional conditions on the group’s financial services licence in June as a result of the breaches.
