Documents reveal Sportsbet pressured watchdog into ‘watering down’ enforcement notice

ABC NEWS (Australia)

The ABC has revealed Sportsbet successfully pressured the Australian Communications and Media Authority - or ACMA - into "watering down" a media statement announcing actions against the gambling company for breaching spam laws.  It comes after the ABC also revealed the watchdog bowed to pressure from Commonwealth Bank to change the date of an enforcement announcement. Geoffrey Watson SC is from the Centre for Public Integrity and former counsel assisting the New South Wales ICAC.

Transcript

00:00It would be different if the statements which were made were inaccurate, but that's not

00:08the case here.

00:09So no, I can't think of any excuse.

00:13And so what do you make of the argument from ACMA that in the case of Sportsbet here, where

00:17some wording was changed at the request of Sportsbet, that the changes did not just diminish

00:22the final statement in any way?

00:25Why were they there in the first place?

00:27In fact, I've read the original statement.

00:28It seems to me to be perfectly sound, solid, well-reasoned and entirely appropriate given

00:35the job ACMA has.

00:37I just do not understand why they would have capitulated.

00:41So looking at this case, who, in your opinion, is out of line here, Sportsbet, ACMA or both?

00:46Well, not Sportsbet.

00:48They've got a job to do, increase the value of the shares, et cetera, et cetera.

00:53They've got PR people who do this.

00:56The embarrassment here is that our regulatory agency is capitulating to pressure from public

01:02relations firms.

01:04What does that...

01:05And the Commonwealth Bank is a little bit of a different circumstance, but we can come

01:09to that.

01:10Yeah, well, let's go to that.

01:12So we'll just repeat that there.

01:15It was yesterday, the ABC revealed the Commonwealth Bank had successfully convinced ACMA to delay

01:19revelations that the bank had breached spam laws until after the CBA's annual general meeting.

01:25What is problematic about what we're seeing there?

01:29Both sides are problematic there.

01:30If you think about it now, why would the regulatory agency be doing that?

01:36It's not in the interests of the shareholders of the company.

01:39It's not in the interests of the public.

01:41It's actually only in the interests of the management and executive of the company.

01:46Why are they doing it?

01:48And then think about this.

01:49Why is ComBank even asking for it to occur?

01:53However, ComBank's first interest, in some views its only interest, is the interest of

01:59the company, that is, the shareholders.

02:02By denying this information to the shareholders, whoever arranged this with ACMA was doing a

02:10favour to the executive and to management at the expense of the shareholders' interest.

02:14So within ComBank itself, it's actually a fairly, I would have thought, serious breach

02:19of their governance policies.

02:22All their legal requirements, for that matter.

02:25So it's, in some ways, a worse one.

02:28Both sides are guilty there.

02:30What does this say to you about the relationship between ACMA and the companies that it regulates?

02:36Far, far too cosy.

02:39Or maybe they've just got no backbone.

02:41You can't explain it by imagining that anyone could say that it was an appropriate role for

02:48a watchdog to put the interests of PR spinners ahead of doing the regulatory task.

02:57In fact, they're undermining their own position.

03:00And so in your opinion, what needs to be done here?

03:03What needs to change?

03:04Well, it's going to have to introduce a spinal cord to ACMA.

03:09They're going to have to ask it to actually stick by and do its job, which is to act as

03:15a kind of watchdog, something which those who it regulates are concerned about, not because

03:24it's unfair, but because it will catch them out.

03:26And when it catches them out, it will expose them for what they've done wrong.

03:30That seems not to be the current thinking at ACMA.

03:33So something's got to change there.

03:36How do you do that?

03:37Well, it's got to come from the top.

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