Deborah O'Neill (NSW, Australian Labor Party) Share this | Link to this | Hansard source

I rise today to speak on the failed IPO of software company Nuix that left thousands of investors devastated and yet made many in a very exclusive club vastly rich. It pocketed Macquarie Bank over $565 million in the float and $24 million in fees. Its remaining stake was worth another $500 million and probably accounted for at least 50 per cent of the profits of Macquarie Capital that financial year. It was a billion-dollar payday for Macquarie, and helped to deliver the Macquarie CEO a $20 million bonus for the 2020-21 financial year. And yet mere months after the IPO the share price plummeted by around 75 per cent, wiping almost $3 billion off the value of shares bought by everyday investors who bought them at the IPO or subsequently. How could ASIC allow this to happen?

Aperion Law wrote multiple letters of complaint on behalf of a client, warning ASIC about the Nuix prospectus, despite being given only the statutory seven-day period to provide comments on a 320-page document. This is how it went. Aperion Law sent its first letter on 23 November 2020, regarding the inclusion of a risk disclosure in the Nuix prospectus that provided an effective carve-out for fraud, tax evasion and money laundering. Aperion Law then sent a second letter on 25 November 2020, this time querying whether the financial forecasts included in the prospectus were properly signed off by the relevant Nuix executives. After receiving no response to the first two letters, Aperion Law sends a third letter directly to acting chair Karen Chester, commissioners Armour, Hughes and Press, and ASIC's chief operating officer, outlining its very significant concerns about Nuix's prospectus. Why, then, given this concerted effort by Aperion, did ASIC fail to properly act on these very valid and prescient complaints? Why had they not done the due diligence and follow-up necessary in response to the Aperion Law inquiries?

Commissioner Cathie Armour was sent a detailed list of the issues with the prospectus. Armour was the general counsel of Macquarie Capital before taking her role as commissioner at ASIC. This is the very same Macquarie Capital that made almost $600 million from this IPO. What did Commissioner Armour not investigate? Why did she not investigate? What contact did she have from Macquarie, in regard to this IPO, that led her to such a complete abdication of responsibility in this regard? Did she even read the Nuix prospectus? Did any of her fellow commissioners at ASIC read and act on concerns validly raised, with some desperation, in three separate communications by Aperion? Acting chair Karen Chester, too, utterly failed in her duties. I've heard, from whistleblowers, that she was too busy dealing with the internal politics of ASIC, manoeuvring to become a permanent chair and building her own cliques within ASIC, rather than effectively prosecuting the job she was actually hired to do.

The failure of ASIC to appropriately regulate Nuix's IPO has had catastrophic consequences for all investors except Macquarie Bank, the Nuix and Macquarie executives in the know, and offshore banks in tax-friendly Vanuatu and Switzerland. This sorry Nuix episode has been a complete failure by ASIC. It must never be repeated.