FEDERAL COURT OF AUSTRALIA

Australian Securities and Investments Commission v Prakash (No 2) [2026] FCA 1267

ORDERS

THE COURT ORDERS THAT:

Carve out for Urgent McKinnon and Tilley Relief

1.    Paragraph 4 of the Orders made on 4 April 2025 (and last varied on 29 January 2026) (the “Asset Preservation Orders”) be varied and/or amended to include new paragraphs 4(d)(viii), and 4(d)(ix) in the following terms:

4.    Order 2 above does not prevent:

…

(d) the Third Defendant from:

…

(viii)     repaying the amount of $1,330,000.00 and all interest lawfully accrued thereupon (the “McKinnon Debt”) to Janice McKinnon as trustee for the McKinnon Superannuation Fund (the “McKinnon Fund”) owed under the loan agreement in place.

(ix)    repaying the amount of $1,070,000 and all interest lawfully accrued thereupon (the “Tilley Debt”) to Wendy Tilley as trustee for the P & W Tilley Superannuation Fund (the “Tilley Fund”) owed under the loan agreement in place.

…

2.    Paragraph 7 of the Asset Preservation Orders be amended to include new paragraph 7(a)(ix) in the following terms:

7.    The First Defendant and Third Defendant (as applicable) shall, within 5 days of the making of a payment referred to in orders 4(d)(viii) and 4(d)(ix) above, provide to the Plaintiff:

(a)     evidence of the amount of the payment made, as follows:

…

(ix)    with respect to the payments identified in orders 4(d)(viii) and 4(d)(ix) above, a copy of the remittance in respect of any payment made;

The Independent Accountant

3.    For the purposes of these Orders “relevant creditors”:

a.    means those self-managed superannuation funds (“SMSF”) lenders who have loaned money to the corresponding “debtor defendants” under the terms of written loan agreements between the relevant SMSFs and debtor defendants;

b.    means those SMSFs who are otherwise owed money for pecuniary loss by the corresponding debtor defendants;

c.    means those SMSFs who may have claims against the defendants for so-called “trading losses” incurred on their CommSec securities trading accounts by the defendants; and

d.    are to be identified by the Independent Accountant by writing to those SMSFs or persons with potential claims against a defendant within seven (7) days of the appointment of the Independent Accountant, in terms that allow for the recipient to notify the Independent Accountant, within seven (7) days of receipt of the correspondence.

4.    For these Orders, “creditors” and “relevant creditors” do not include ASIC.

5.    That Anthony Lowe of Deloitte Australia be appointed to act as an independent accountant (the “Independent Accountant”) and in that role he shall within a period of 35 days:

a.    identify each defendant’s relevant creditors and the amount they are owed, or may be owed should action be taken against the defendants under the written loan agreements, for the recovery of monies, and/or so-called trading losses, including any lawfully accrued interest payable;

b.    identify whether each of the defendant’s relevant creditors is secured or unsecured;

c.    identify each defendant’s assets and liabilities;

d.    determine each defendant’s capacity to pay its relevant creditors, including having regard to competing claims of other creditors, and whether they are secured or unsecured;

e.    to the extent necessary, reconcile intercompany loans as between the defendants and any related party loans if any, including securities given between related parties; and

f.    confirm the liability of the third defendant for the McKinnon Fund and the Tilley Fund as per paragraph 1 or, otherwise to determine the entity lawfully liable to repay the McKinnon and Tilley loan balances plus any lawfully accrued interest.

6.    The plaintiff shall provide the Independent Accountant with:

a.    the defendants’ bank statements during the relevant period in a consolidated excel spreadsheet;

b.    the defendants’ home loan statements (where available);

c.    copies of loan agreements with the SMSF (where available);

d.    letters of demand (where available);

e.    a list of the defendants’ clients (as provided to the plaintiff under notice); and

f.    such reasonable assistance from the plaintiffs as the Independent Accountant requests,

and disclose to the defendants the identity of any documents it provides the Independent Accountant in addition to the above.

7.    The defendants may provide the Independent Accountant information and documents, and, upon request:

a.    books and records of the defendants in their possession or control; and

b.    reasonable assistance.

8.    The Independent Accountant shall not, after being engaged, communicate with the plaintiff in relation to this matter except with the express written consent of the defendants, which is not to be unreasonably withheld, or as otherwise ordered by the Court. Such communication shall be in writing (including email), and shall include the legal representatives for the defendants, reading in copy.

9.    The Independent Accountant shall, in addition to the tasks set out in paragraph 5, within 35 days of his appointment, or such other time as the Court considers appropriate, provide to the Court and to the defendants, a schedule (the “Findings Schedule”) setting out his final findings with respect to each of the matters set out at sub-paragraphs 5(a) to 5(f) of this order. If the Independent Accountant is unable to satisfactorily ascertain or form opinions on the matters at sub-paragraphs 5(a) to 5(f), he will advise the Court in the Findings Schedule the reasons for not being able to reach a position.

10.    The Independent Accountant shall not provide the Findings Schedule to the plaintiff unless ordered by the Court to do so.

11.    To prevent any prejudice to the proper administration of justice, the Findings Schedule filed with the Court by the Independent Accountant shall not be published or otherwise disclosed to any person except in accordance with these Orders pursuant to s 37AF of the Federal Court of Australia Act 1976 (Cth).

12.    The Independent Accountant’s reasonable costs and expenses shall be payable from the property of the defendants.

13.    The Independent Accountant has liberty to apply for the payment of his reasonable costs and expenses from the property of the defendants.

14.    Within 7 days of the Independent Accountant’s filing the Findings Schedule pursuant to paragraph 9 with the Court, the defendants shall provide a consent order (the “Consent Order”) to Ms Ingrid McCormick on behalf of the plaintiff for discharge and/or variation of the Asset Preservation Orders such that each debtor defendant identified by the Findings Schedule be permitted to pay or repay the relevant creditor amounts in the sum that the Independent Accountant determines pursuant to paragraph 9 of these orders:

a.    by agreement with the relevant debtor defendant; or

b.    if disputed by the relevant debtor defendant, then paid into Court for the purpose of satisfying any potential future claim for pecuniary loss against the relevant debtor defendant.

15.    The plaintiff shall not unreasonably withhold its consent to the Consent Order provided under paragraph 14 and provide the Consent Order to the Court within 5 days of receiving the Consent Order.

16.    For the purpose of obtaining the plaintiff’s consent to the Consent Order, Ms McCormick may provide the Consent Order to a Senior Executive Leader of the plaintiff (who is not involved in the criminal investigation or prosecution of the defendant), but to no other person. The plaintiff shall take all necessary steps to secure the Consent Orders to prevent them from being disseminated to any other person both within the plaintiff or outside of the plaintiff.

17.    That upon the payment of the sums pursuant to paragraph 14, the matter be listed for a case management hearing (on a date to be advised), unless the parties agree in the intervening period to orders for the discharge of the Asset Preservation Orders.

18.    Costs be reserved.

19.    Liberty to apply on 5 business days’ notice.

ORDERS

THE COURT ORDERS THAT:

1.    By 4:00pm AEST on 2 September 2026, the parties advise whether any redaction or suppression of the reasons for judgment delivered on 31 August 2026 is necessary to prevent prejudice to the administration of justice, and if so, provide complete particulars of any redaction or suppression sought, accompanied by supporting submissions of not more than two pages.

2.    Pursuant to s 37AI of the Federal Court of Australia Act 1976 (Cth), there be no publication of the reasons for judgment delivered on 31 August 2026 before 2 September 2026, or until a date provided by further order.

3.    In the event that the parties do not advise that any redaction or suppression is necessary pursuant to order 1, the reasons for judgment delivered on 31 August 2026 be published on or after 2 September 2026.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

MEAGHER J

INTRODUCTION

1    This proceeding arises out of an ex parte originating process filed by the plaintiff, the Australian Securities and Investments Commission (ASIC), on 27 March 2024. The first defendant is Mr Prakash, who is the sole director and shareholder of each of the second to fifth defendants, save for the third defendant, of which he is the majority shareholder. Following a hearing of that originating process, on 28 March 2024, I made, inter alia, orders restraining the defendants from dealing with their property except as provided for in the orders (Asset Preservation Orders): Australian Securities and Investments Commission v Prakash [2024] FCA 321.

2    The background to this proceeding is more comprehensively set out at [3] – [16] of Prakash. Broadly, at the time that the Asset Preservation Orders were made, ASIC was investigating the first and second defendants for suspected contraventions of s 12CB of the Australian Securities and Investments Commission Act 2001 (Cth) (ASIC Act), ss 912A and 1041G of the Corporations Act 2001 (Cth) and s 408C of the Criminal Code 1899 (Qld). It was also investigating the third to fifth defendants for suspected contraventions of s 911A of the Corporations Act. The evidence regarding the current state of ASIC’s investigation is set out below, noting that there was, and may still be, some dispute between the parties as to whether it is ongoing.

3    The Asset Preservation Orders have been varied numerous times by consent throughout this proceeding. On 19 March 2026, the defendants filed an interlocutory application (Interlocutory Application) seeking to discharge the Asset Preservation Orders or, alternatively, to discharge or vary the orders to permit the third defendant to repay the principal and any contractual interest to relevant funds to which it was indebted or, alternatively, to permit the third defendant to repay the principal and contractual interest owing to one fund, subject to notifying ASIC and the Registrar of the Court. By their oral submissions, the defendants later restricted the relief sought, to enable repayment to only one fund, with repayments to other funds to be dealt with at a later time.

4    The basis for the Interlocutory Application, set out in the defendants’ written submissions filed on 23 March 2026, was broadly that ASIC had proceeded too slowly in its investigation, and that the Court should proceed on the basis that its investigation had concluded. Additionally, the second to fifth defendants were solvent and wanted to pay their debts, but were prevented from doing so by the Asset Preservation Orders. They said that ASIC had not established that it was “necessary or desirable”, within the meaning of s 1323 of the Corporations Act, for the Asset Preservation Orders not to be discharged insofar as they restrained the third defendant from making the relevant repayments.

5    As to the criminal charges, the defendants characterised the case against Mr Prakash as being, inter alia, that “the written loan agreements are shams and that it was always the subjective and dishonest intention of Mr Prakash to keep the loan balances for the benefit of SMS [the third defendant] and/or the other Defendants”, and that the fact that the loan amounts had not been repaid showed Mr Prakash’s intention to permanently deprive the funds of those loan balances. Further, the defendants characterised ASIC’s case as being that he intended to “dishonestly gain a benefit for himself by causing a detriment to the funds”.

6    It is to be noted that the defendants’ submissions contained several scurrilous allegations in respect of ASIC’s conduct and motivations in investigating the defendants, which were unsubstantiated on the evidence.

7    ASIC’s position, as contained in its written submissions filed on 2 April 2026, was broadly that it supported, in principle, the defendants making restitution to clients, but maintained that it needed to do so in a fair, transparent, independent and comprehensive manner and that the risk of them being left with insufficient funds to repay other aggrieved persons should be avoided. It therefore requested further time to engage with the defendants to agree a framework to appoint, for example, an independent forensic accountant to further these purposes. In its submission, the time that had passed since the Asset Preservation Orders were made reflected the scope and complexity of the investigation, rather than any undue delay by ASIC.

8    The current state of the investigation was set out in the affidavits of Mr Empson, the case officer for ASIC’s investigation into the defendants’ conduct since January 2025, filed on 16 March 2026 (First Empson Affidavit) and 2 April 2026 (Second Empson Affidavit). Broadly, in this regard, Mr Empson deposed as follows.

9    First, his understanding was that the defendants continued to carry on business. Second, the scope of the investigation into Mr Prakash’s conduct had expanded over time, including as to the time period, entities, criminal offences and contraventions being investigated. As far as concerned Mr Prakash, the alleged offences comprised potential contraventions by the defendants and associated entities, directors, employees or representatives of s 12CB of the ASIC Act, ss 184, 911A, 912A, and 1041G of the Corporations Act, s 408C of the Criminal Code, and s 400.4 of the Schedule to the Criminal Code Act 1995 (Cth).

10    Third, as a result of ASIC’s investigation, on 28 August 2025, ASIC had referred a brief to the Office of the Commonwealth Director of Public Prosecutions (CDPP). On 6 March 2026, Mr Prakash was charged with 11 offences under the Corporations Act and the Criminal Code, being:

(1)    Two counts of carrying on a financial services business without holding an Australian financial services licence covering the provision of the financial services in contravention of ss 911A(1) and 1311(1) of the Corporations Act.

(2)    Seven counts of dishonestly applying property belonging to another to the use of himself or another, in circumstances where the property had a value of at least $100,000.00, in contravention of ss 408C(1)(a)(i) and (2A)(a) of the Criminal Code.

(3)    One count of, in the course of carrying on a financial services business in Australia, engaging in dishonest conduct in relation to the acquisition and disposal of securities in contravention of ss 1041G and 1311 of the Corporations Act.

(4)    One count of, in the course of carrying on a financial services business in Australia, engaging in dishonest conduct, being misrepresentation of an investment in the sum of $1,000,000.00, in contravention of ss 1041G and 1311 of the Corporations Act.

11    The charges laid against Mr Prakash allege that between January 2016 and June 2024, he engaged in the provision of unlicensed financial services related to securities, executed unauthorised share trades on client accounts, falsified a fixed-term deposit certificate and misappropriated funds from both personal and self-managed superannuation fund bank accounts belonging to his clients, for his and third parties’ benefit. The funds alleged to have been misappropriated exceed $4.9 million, and the alleged trading losses exceed $1.27 million. Mr Prakash has been granted bail in relation to the charges. ASIC’s media release dated 9 March 2026, which set out the above charges, was annexed to an affidavit of Mr Prakash filed on 8 April 2026.

12    Fourth, ASIC’s investigation into the defendants’ conduct remained ongoing. In particular, Mr Empson deposed to ASIC having reviewed extensive material seized from search warrants executed at the home of Mr Prakash and the defendants’ business premises on 27 March 2024, as well as documents obtained pursuant to compulsory notices. It had undertaken compulsory examinations and witness interviews, engaged with CommSec to understand Mr Prakash’s trading activity in the names of clients, and conducted a tracing analysis in respect of the receipt and application of funds of the clients identified during the investigation. It was his view that given charges had only recently been laid against Mr Prakash, there was a real prospect that publicity associated with his first appearance at the Magistrates Court of Queensland at Brisbane would give rise to further avenues of inquiry. Further, the investigation of alleged offences in relation to an auditor engaged from time to time by the third defendant was ongoing, with no charges laid at the time of the First Empson Affidavit. Mr Empson anticipated that it would take a further six months to complete the investigation.

13    Mr Empson adverted in the First Empson Affidavit to the possibility that deposing in detail to ASIC’s plans in respect of the next steps in its investigation, or setting out the evidence collated by ASIC to date, might prejudice the proper conduct of the ongoing investigation or of the present or any future criminal proceedings. His concerns were that (1) persons of interest might collude as to their evidence, (2) available evidence might be destroyed or concealed, and (3) there might be interference with potential witnesses.

14    The First Empson Affidavit also dealt with ASIC’s concerns arising out of the Interlocutory Application, namely that potentially aggrieved individuals be repaid in a fair, orderly and timely manner, and that repayment in a premature or ad hoc manner should not result in unfairness between potentially aggrieved individuals resulting from some being able to act more quickly to protect their position, to the disadvantage of others. Mr Empson referred further to alleged conduct by Mr Prakash which suggested that he might not have complied with, or might have taken steps to circumvent, the Asset Preservation Orders, and further that if they were lifted, there was a risk of the defendants’ property being dissipated such that the potentially aggrieved individuals might be unable to be repaid.

15    The issues raised in the Interlocutory Application were ultimately dealt with largely by agreement between the parties, despite there being initial reluctance to do so, at least due in part to unsubstantiated allegations made regarding ASIC’s motivations and conduct in the course of its investigation. On 28 May 2026, following several hearings of the Interlocutory Application, I made orders (Orders) varying the Asset Preservation Orders. The Orders permitted the third defendant to repay principal and interest owing in respect of amounts owing to certain self-managed superannuation funds and required the first and third defendants to provide evidence of the payment made.

16    The Orders also provided for the appointment of an independent accountant (Independent Accountant). The Independent Accountant’s role was to do the following:

a.     identify each defendant’s relevant creditors and the amount they are owed, or may be owed should action be taken against the defendants under the written loan agreements, for the recovery of monies, and/or so-called trading losses, including any lawfully accrued interest payable;

b.     identify whether each of the defendant’s relevant creditors is secured or unsecured;

c.     identify each defendant’s assets and liabilities;

d.     determine each defendants’ capacity to pay its relevant creditors, including having regard to competing claims of other creditors, and whether they are secured or unsecured;

e.     to the extent necessary, reconcile intercompany loans as between the defendants and any related party loans if any, including securities given between related parties; and

f.     confirm the liability of the third defendant for the McKinnon Fund and the Tilley Fund as per paragraph 1 or, otherwise to determine the entity lawfully liable to repay the McKinnon and Tilley loan balances plus any lawfully accrued interest.

17    “[R]elevant creditors” was defined as follows:

3. For the purposes of these Orders “relevant creditors”:

a.    means those self-managed superannuation funds (“SMSF”) lenders who have loaned money to the corresponding “debtor defendants” under the terms of written loan agreements between the relevant SMSFs and debtor defendants;

b.    means those SMSFs who are otherwise owed money for pecuniary loss by the corresponding debtor defendants;

c.    means those SMSFs who may have claims against the defendants for so-called “trading losses” incurred on their CommSec securities trading accounts by the defendants; and

d.    are to be identified by the Independent Accountant by writing to those SMSFs or persons with potential claims against a defendant within seven (7) days of the appointment of the Independent Accountant, in terms that allow for the recipient to notify the Independent Accountant, within seven (7) days of receipt of the correspondence.

    (Original emphasis.)

18    The Orders created a regime for the parties to provide certain documents to the Independent Accountant, in which the Independent Accountant is, inter alia, not to communicate with ASIC in this matter except with the defendants’ express written consent or as otherwise ordered. Within 35 days of his appointment, the Independent Accountant is to provide to the Court and to the defendants, a schedule (Findings Schedule) setting out his final findings with respect to each of the matters set out at [16] above. He is not to provide the Findings Schedule to ASIC unless ordered to do so. At the time of this judgment, the Findings Schedule has not been filed with the Court.

19    Within seven days of the Independent Accountant filing the Findings Schedule, the defendants are to provide a consent order to Ms McCormick, a lawyer employed by ASIC, to discharge or vary the Asset Preservation Orders such that each debtor defendant is permitted to pay or repay the relevant creditor amounts in the sums the Independent Accountant determines. The Orders provide for the eventuality that the amount is disputed by the relevant debtor defendant. ASIC’s consent to such orders is not to be unreasonably withheld, and the Orders provide for a mechanism whereby Ms McCormick can provide the consent order to a Senior Executive Leader within ASIC who is not involved in the criminal investigation or prosecution of Mr Prakash, but prohibit her from providing them to any other person. ASIC is required to take all necessary steps to secure the consent orders to prevent them from being disseminated to any other person both within or outside of ASIC.

20    The Orders contain the following order (Non-publication Order):

To prevent any prejudice to the proper administration of justice, the Findings Schedule filed with the Court by the Independent Accountant shall not be published or otherwise disclosed to any person except in accordance with these Orders pursuant to s 37AF of the Federal Court of Australia Act 1976 (Cth).

21    These written reasons explain the basis for the making of the Non-Publication Order and two other matters in the Orders about which there were differing positions between the parties, being whether the orders should require the Independent Accountant to determine whether the relevant creditors are secured or unsecured and, to the extent necessary, to reconcile intercompany loans as between the defendants and any related party loans, if any, including securities given.

22    For completeness, I will list the materials that the parties relied upon in the Interlocutory Application. ASIC relied upon:

(1)    The First and Second Empson Affidavits.

(2)    Written submissions filed on 2 April and 14 May 2026.

(3)    An affidavit of Ms McCormick filed on 28 May 2026 (McCormick Affidavit).

23    The defendants relied upon:

(1)    An affidavit of Ms McKinnon filed on 23 March 2026.

(2)    An affidavit of Mr Chaudhary filed on 23 March 2026.

(3)    Written submissions of the defendants filed on 23 March 2026.

(4)    Affidavits of Mr Prakash filed on 24 March, 8 April and 18 May 2026.

(5)    Written submissions of the third defendant filed 8 April 2026.

(6)    An affidavit of Mr Bentley filed on 20 May 2026.

(7)    Expert reports of Mr Hambleton regarding:

(a)    The third defendant, dated 31 March 2026.

(b)    The second defendant, dated 13 May 2026.

(c)    The fourth defendant, dated 13 May 2026.

(d)    The fifth defendant, dated 14 May 2026.

PRINCIPLES

24    Sections 37AE, 37AF and 37AG of the Federal Court of Australia Act 1976 (Cth) (FCA Act) provide as follows:

37AE  Safeguarding public interest in open justice

In deciding whether to make a suppression order or non-publication order, the Court must take into account that a primary objective of the administration of justice is to safeguard the public interest in open justice.

37AF  Power to make orders

(1)     The Court may, by making a suppression order or non-publication order on grounds permitted by this Part, prohibit or restrict the publication or other disclosure of:

(a)     information tending to reveal the identity of or otherwise concerning any party to or witness in a proceeding before the Court or any person who is related to or otherwise associated with any party to or witness in a proceeding before the Court; or

(b)     information that relates to a proceeding before the Court and is:

(i)     information that comprises evidence or information about evidence; or

(ii)     information obtained by the process of discovery; or

(iii)     information produced under a subpoena; or

(iv)     information lodged with or filed in the Court.

(2)     The Court may make such orders as it thinks appropriate to give effect to an order under subsection (1).

37AG  Grounds for making an order

(1)     The Court may make a suppression order or non-publication order on one or more of the following grounds:

(a)     the order is necessary to prevent prejudice to the proper administration of justice;

(b)     the order is necessary to prevent prejudice to the interests of the Commonwealth or a State or Territory in relation to national or international security;

(c)     the order is necessary to protect the safety of any person;

(d)     the order is necessary to avoid causing undue distress or embarrassment to a party to or witness in a criminal proceeding involving an offence of a sexual nature (including an act of indecency).

(2)     A suppression order or non-publication order must specify the ground or grounds on which the order is made.

25    By virtue of r 2.32(4) of the Federal Court Rules 2011 (Cth), the Findings Schedule, when filed, will be a document that a person “is not otherwise entitled to inspect”, but one in respect of which he or she could apply for leave to inspect.

26    In Country Care Group Pty Ltd v Director of Public Prosecutions (Cth) (No 2) [2020] FCAFC 44; 275 FCR 377, the Court at [7] – [9] stated as follows:

The relevant principles in relation to the making of suppression or non-publication orders under s 37AF of the FCA Act are fairly well settled.

Suppression or non-publication orders should only be made in exceptional circumstances. That is both because the operative word in s 37AG(1)(a) is “necessary” and because the court must take into account that a primary objective of the administration of justice is to safeguard the public interest in open justice. The paramount consideration is the need to do justice; publication can only be avoided where necessity compels departure from the open justice principle.

The critical question is whether the making of a suppression or non-publication order is “necessary to prevent prejudice to the proper administration of justice”. The word “necessary” in that context is a “strong word”. It is nevertheless not to be given an unduly narrow construction. The question whether an order is necessary will depend on the particular circumstances of the case. Once the court is satisfied that an order is necessary, it would be an error not to make it. There is no exercise of discretion or balancing exercise involved.

(Footnotes omitted.)

27    These principles were affirmed by the Full Court in AHG WA (2015) Pty Ltd v Mercedes-Benz Australia/Pacific Pty Ltd (No 2) [2025] FCAFC 97 at [10].

28    The FCA Act “proceeds on the basis that the administration of justice is ordinarily promoted by safeguarding the public interest in open justice”: Australian Competition and Consumer Commission v BlueScope Steel Ltd [2019] FCA 1532 at [26]. In Minister for Immigration and Border Protection v Egan [2018] FCA 1320 at [4], Allsop CJ stated as follows:

… Open justice is not an absolute concept, unbending in its form. It must on occasion be balanced with other considerations, including but not limited to considerations such as the avoidance of prejudice in the administration of justice…

29    The prevention of prejudice to the proper administration of justice may, in an appropriate case, extend beyond the proceeding before this Court: Cantor v Audi Australia Pty Limited (No 4) [2019] FCA 1633 (Audi (No 4)) at [24]. In that case, Foster J considered that the proper administration of justice permitted the Court to “tak[e] into account … relevant considerations which extend beyond the particular proceedings in which the suppression order is sought and which also extend beyond considering only the interests of the parties to that proceeding”: at [26]; see also at [36].

30    In BlueScope, O’Bryan J at [32] stated as follows:

As observed by the High Court in Hogan v Australian Crime Commission (2010) 240 CLR 651 at [30] (with respect to the predecessor provision to s 37AG(1)(a) – s 50 – which was in substantially identical terms), “necessary” is a strong word and it is insufficient that the making of a suppression or non-publication order appears to be “convenient, reasonable or sensible”. Accepting that “necessary” is a strong word, it nevertheless has shades of meaning which reflect the context in which it is used: Fairfax Digital Australia and New Zealand Pty Ltd v Ibrahim (2012) 83 NSWLR 52 (Ibrahim) at [8] per Bathurst CJ and [45] per Basten JA. In the context of s 37AG(1), the test of necessity must be applied on a forward looking basis to criteria which are broadly defined (administration of justice, national security, safety of a person and undue distress and embarrassment). In the context of s 37AG(1)(a) specifically, the prejudice to the administration of justice that may be caused by the publication of information may be a possibility or a certainty; the effect of publication may be minor or serious; and the effect of a suppression or non-publication order may diminish the risk of prejudice or obviate it altogether: Ibrahim at [46] per Basten JA. …

CONSIDERATION

Why the Non-publication Order was sought

31    As the Orders arose out of the parties’ discussions over several hearings of the Interlocutory Application, the Court did not have the benefit of fulsome, comprehensive submissions as to the necessity of the Non-publication Order. However, the basis for the order, which emerged from the parties’ oral statements to the Court on the various dates on which the Interlocutory Application was heard, and the McCormick Affidavit, was as follows.

32    First, Mr Prakash held concerns that the documents that he might be required to provide to the Independent Accountant in order for him to complete his tasks, or information received from the Independent Accountant regarding the quantum owed by the relevant defendant might result in the loss of his right against self-incrimination and the loss of his right to a fair trial.

33    Second, and relatedly, Mr Prakash held concerns about the generation of a report by the Independent Accountant subverting his right to a fair trial. In particular, he was concerned that the accountant would be making findings and providing reports which, on the Court record, might suggest that he had engaged in wrongdoing.

34    Third, Mr Prakash did not want any information produced by the Independent Accountant in any schedule or report to be made available to ASIC, for essentially the same reasons. Otherwise, his right to a fair trial and his right against self-incrimination would not be protected. ASIC was in express agreement that it should not receive a copy of the Findings Schedule unless the Court ordered.

Caselaw regarding suppression orders to protect the integrity of a criminal trial

35    Several cases supported the making of a suppression order on the basis that it was necessary to prevent prejudice to the proper administration of justice. In particular, it was necessary to protect the integrity of a criminal trial concerning factual matters which overlap with the proceeding in this Court.

36    Gregg v Fairfax Media Publications Pty Ltd [2017] FCA 440 concerned an application to stay the proceeding until the determination of two criminal charges brought against the applicant by an informant on behalf of ASIC, which were likely to be prosecuted on indictment: at [1]. The subject matter of the charges formed one of the bases of the respondent’s substantive defence of justification in the defamation proceeding brought by the applicant in this Court: at [2]. The parties accepted that the proceeding in this Court should be stayed until the determination of the criminal charges, but were in dispute as to whether, inter alia, the respondent should have access to documents produced by ASIC, and its prosecution brief, as well as documents produced by PwC Strategy & (Australia) Pty Limited: at [4]. The criminal charges and proceeding had been the subject of extensive publicity: at [5].

37    Rares J made orders, pursuant to s 37AI of the FCA Act, that until further order, portions of the transcript of the hearing, certain affidavits, and certain paragraphs of the applicant’s submissions, be suppressed and not published. The notes to the orders recorded that the ground for that order was that it was necessary to prevent prejudice to the proper administration of justice. At [30], his Honour accepted that the suppression and non-publication orders were made on the basis that it was necessary “for the purposes of protecting the administration of justice in respect of the criminal proceedings”. His Honour appeared to consider the basis for those orders at [6] – [10], before considering, at [15] – [32], the question of whether the stay contended for by both parties should, as the respondent submitted, be fashioned so as to allow access to documents already produced, or to require further production by the applicant: see at [11], [26]. However, that second portion of the judgment did not concern the test of necessity under Pt VAA of the FCA Act; rather, it concerned the Court’s inherent power to stay a proceeding, in the exercise of its discretion, and to impose conditions on any stay that was granted: at [22] – [25].

38    As to the suppression and non-publication orders, his Honour recorded that the necessity for those orders “arose in the context of the criminal proceedings and the overlap of issues in those proceedings and the present civil proceedings”: at [6]. The applicant’s solicitor’s evidence was that the applicant had intended, but for the intervening pendency of criminal charges, to serve in his case his own outline of evidence. Such evidence might, if served, traverse issues the subject of the criminal charges. Any compulsion to do so, as provided for by the existing timetabling orders, would undermine his common law right not to incriminate himself or reveal how he may wish to defend the criminal charges: at [7] – [8]. In light of the overlap of issues between both proceedings, if the proceedings were to proceed concurrently, there were real prospects that (1) the applicant might have to disclose information in the civil proceeding that he could not be compelled to disclose in the criminal proceeding, (2) disclosures or attempts to obtain further evidence by way of subpoenas in the civil proceeding might influence witnesses in the criminal proceeding, (3) the continuation of the civil proceeding with attendant publicity might influence persons who were or might become members of the jury if the criminal charges were prosecuted on indictment, (4) the above might lead to speculation or conclusions about the criminal proceedings that would not be in the interests of justice: at [9].

39    His Honour noted that the above “factors” informed the consideration of the respondent in accepting the appropriateness of a stay in some form: at [10]. However, his Honour’s reference at [6] to the overlap of issues giving rise to the necessity of suppression and non-publication orders suggests that these factors, also considered in the context of the “overlap of issues” between the civil and criminal proceedings, informed his Honour’s conclusions as to necessity.

40    BlueScope concerned an application for suppression orders in respect of the originating application and concise statement filed by the applicant, the Australian Competition and Consumer Commission (ACCC), by which it alleged that the respondents had engaged in cartel conduct. Those allegations had been canvassed generally by the applicant in a media release, which indicated that the applicant was seeking civil penalties and other civil remedies, and that the conduct was currently being considered by the CDPP: at [6] – [8]. However, the originating application and concise statement contained more detail about the applicant’s allegations, including particular events, conduct, and competitors of the first respondent, during the period of the alleged contraventions: at [11]. The applicant’s media release had generated “considerable media interest in the story”, due to the fact that cartel conduct was regarded as serious, the first respondent was a large, well-known Australian company, and the second respondent was the son of the former chairman of BHP: at [9]. The applicant’s evidence was that serious cartel conduct was referred to the CDPP for prosecution wherever possible, and that this conduct had been referred in the form of a brief of evidence. A decision about whether to prosecute was anticipated by October 2019 (i.e., approximately one month from the date of the hearing of the application for suppression orders): at [10].

41    The parties to the proceeding, who all supported the making of suppression and non-publication orders, submitted that these were necessary to prevent prejudice to the proper administration of justice said to flow from (1) the risk of “contaminating” the jury pool for any future prosecution by the CDPP, by reason of being exposed to allegations made in the proceeding in this Court which are not part of the CDPP’s case in the criminal proceeding: at [13], and (2) the risk that any reporting might affect the evidence of any person providing statements from witnesses with personal knowledge of some aspects of the alleged conduct, by displacing or contextualising their alleged recollections: at [17]. As to (1), the parties submitted that there was considerable media interest that was likely to continue, and the identity of the first and second respondents meant that it was likely that the members of the public would retain any information reported: at [14].

42    O’Bryan J accepted that it was not uncommon for courts to make suppression orders in relation to material revealed in the course of one proceeding that has the potential to interfere with another proceeding: at [34]. However, his Honour considered that the first basis for the suppression orders was not established because, firstly, the risk of prejudice to a fair trial was remote, and secondly, any risk of a juror learning of prejudicial but irrelevant allegations or information could be mitigated by the usual jury directions: at [37]. This was because (1) no criminal trial had been commenced, and the likelihood of one being commenced could not be assessed, (2) even if a trial were commenced, it would be unlikely to occur for at least 12 months, such that any reporting of the allegations would be “a long way in the past”, (3) the allegations in the proceeding in this Court concerned wrongful business conduct which, while serious and likely to be harmful to relevant sections of the public, was not likely to be of wide interest or to generate particular notoriety or scandal, (4) the applicant’s media releases had already made public the main aspects of the allegations against the respondents, and while the originating application and concise statements contained more details, they were expressed at a relatively high level of generality, and (5) the publication of allegations, rather than evidence or findings, in a civil proceeding, was unlikely to cause prejudice to a subsequent criminal trial involving the same or similar allegations: at [38].

43    As to the second basis for the suppression orders, his Honour considered that there was virtually no evidence regarding the timing and extent of the applicant’s investigation, in light of which the Court was left to speculate about the extent of investigations conducted to date and the range of witnesses spoken to. There was therefore no evidence satisfying the Court that further reporting of the allegations would affect potential witnesses in any material way: at [41] – [42].

44    Therefore, the suppression orders were not necessary to prevent prejudice to the proper administration of justice in that proceeding: at [43].

45    Audi (No 4) concerned an application by the respondents pursuant to s 37AF of the FCA Act, on the ground specified in s 37AG(1)(a) of the FCA Act, prohibiting the disclosure of confidential information to persons other than those specified in the claimed order: at [1]. The substantive proceeding concerned a disclosure by Volkswagen AG that certain diesel engines contained hidden software that would cause the engine to emit higher levels of nitrogen oxides when driven on the road compared to when tested in a laboratory: Cantor v Audi Australia Pty Limited (No 2) [2017] FCA 1042 at [1] (Audi (No 2)). Several class actions were commenced in respect of this issue, as well as proceedings by the ACCC and a proceeding by Complete Taxi Management Pty Ltd and others: Audi (No 2) at [3] – [7]. In all class actions, the applicants alleged that the software was a “defeat device” within the meaning of relevant design rules and the Australian Vehicle Emissions Standards: Audi (No 2) at [10]. They alleged breaches of the Australian Consumer Law (being Sch 2 to the Competition and Consumer Act 2010 (Cth)): Audi (No 2) at [11]. In a particular class action, the applicants also alleged unconscionable conduct, deceit, general law misrepresentation and a failure to comply with an express warranty: Audi (No 2) at [12].

46    The non-publication order was sought in respect of names of certain current and former employees of one or more of the respondent companies contained in certain documents before the Court: Audi (No 4) at [7]. The respondents also sought an order preventing the disclosure of the identity of the employing or retaining entity of each individual (except where this was VWAG), and their positions, titles and responsibilities held during the relevant period: Audi (No 4) at [9]. The respondents argued that the information should be subject to a suppression order because, if disclosed, it might “detrimentally and unfairly affect or contaminate criminal prosecutions” of a number of those individuals that were underway or foreshadowed in Germany or the United States of America (US) which were or might be based on the same substrate of facts about which this Court would be called to make findings: Audi (No 4) at [10]. The respondents also sought suppression orders in respect of allegedly commercially sensitive documents: Audi (No 4) at [12] – [13]. Between the time that the non-publication orders were sought, and the time the suppression orders were made, all class actions and regulatory proceedings were settled in principle: Audi (No 4) at [15]. The non-publication orders were, at the time they were determined, unopposed: at [16].

47    His Honour acknowledged that answers to interrogatories in that proceeding contained the names of 67 current or former employees of VWAG, its related corporations or affiliates, whom VWAG believed were involved in some way in the software’s development, installation or modification in motor vehicles, or approval thereof. In its answers, VWAG considered that the purpose of some of those persons in engaging in that conduct was to ensure the vehicles passed emissions tests, even though they would not have passed the test in “road mode”. Therefore, the answers might have identified, as well as incriminated, those responsible for conceiving of and implementing the scheme: at [39]. None of those individuals had appeared before the Court or was a party to the proceeding. Their identity had been disclosed by the respondents by compulsion, and not by the individuals themselves. They had been made aware of the respondents’ obligations to answer certain interrogatories, and of the general substance of the answers that VWAG intended to give. Many advised VWAG’s solicitors that they had concerns that any disclosure might prejudice their criminal trial: at [40].

48    Many of the current and former VWAG employees referred to in the respondents’ answers to interrogatories were the subject of criminal investigations in Germany and the US. In Germany, some were the subject of indictments which were, or were likely to be, submitted. Others were formal suspects in ongoing investigations. The offences alleged were very serious, and carried penalties of imprisonment, some for up to ten years. In the US, some individuals had been charged, convicted and imprisoned, and others were under indictment or being investigated. It was unclear who would be the subject of further prosecutions. All the criminal charges involved very serious offences. The German proceedings would likely be presided over by two professional judges and two lay judges, and all the US proceedings would be tried before a judge and a jury: at [41].

49    Despite there having been some publicity in relation to the German and US criminal investigations, save for those employees in relation to whom an indictment had been made public in the US, or who had been convicted in the US, no employee identified in the answers to interrogatories or in a relevant notice to admit facts had been identified in any publicly available documents as being involved in the conduct the subject of the Australian proceeding in the manner and specificity described in the answers to interrogatories and the notice to admit facts: at [42].

50    Foster J accepted that absent suppression orders made under s 37AF of the FCA Act, in the event that the involvement of the individuals in “dieselgate” came to light by reason of the documents becoming public, there was a real risk that the German and US judges, and the US juries, would learn of the detail of the involvement and find it difficult to put it out of their minds: at [43] – [44]. There was therefore a “real risk of compromise to the fairness of the criminal trials of those persons” who were already the subject of charges in Germany and the US, and who might, in the future, be subject to such charges: at [45]. At [45], his Honour considered that:

… If, for example, a lay judge in one of the German trials or a jury member in one of the US trials becomes aware of the fact that the respondents have given verified answers to interrogatories in connection with the Australian proceedings that, to the best of their knowledge, information and belief, the particular accused was involved in the development of the impugned software and that his or her purpose in being so involved was to defeat the European or US vehicle emissions tests, that lay judge or jury member, even acting conscientiously, would find it difficult to place that fact out of his or her mind. …

51    Therefore, there was a “substantial risk that the revelation in the Australian proceedings of the identity of those whom the respondents consider to be responsible for the development” and installation of the software “will unfairly prejudice the trial” in Germany and the US of many of the individuals over whose names the non-publication orders were sought. This was “prejudicial to the administration of justice by this Court and, more than likely, by courts in Germany and in the US”: at [46]. Therefore, the making of a suppression order was “well-warranted”: at [47]. By reason that all parties in the proceedings in this Court had access to the relevant documents in which information was sought to be suppressed, the suppression order would not render that proceeding “unworkable”: at [48].

52    In Cantor v Audi Australia Pty Limited (No 8) [2025] FCA 134, Goodman J made orders continuing those made by Foster J in Audi (No 4) on the basis that they were necessary to prevent prejudice to the proper administration of justice, in circumstances where indictments had been submitted, certain individuals had been charged, convicted and imprisoned, and other hearings were likely to commence in 2025, with proceedings potentially extending beyond 2026: at [12] – [28].

53    Australian Competition and Consumer Commission v Meta Platforms, Inc (formerly Facebook, Inc) [2022] FCA 1062 concerned allegations of contraventions by the respondents of various provisions of the Australian Consumer Law, or alternatively of the ASIC Act, arising out of the publication of “sponsored posts” on the Facebook platform relating to cryptocurrency investments: at [1] – [6]. The respondents sought orders pursuant to s 37AF of the FCA Act, on the ground contained in s 37AG(1)(a) of the FCA Act, that there be no publication or inspection of the originating application and concise statement or, alternatively, certain parts thereof, until the resolution of a private prosecution commenced in the Magistrates Court of Western Australia against the first respondent before the proceeding in this Court was commenced: at [7], [11]. They also sought similar orders in relation to an exhibit to an affidavit being a “Statement of Material Facts” deployed in the criminal proceeding, and in relation to its written submissions in support of its application for suppression orders: at [8], [18]. The asserted basis for the orders was the prejudice to the first respondent’s ability to receive a fair criminal trial: at [9]. The respondents’ application for suppression orders was opposed: at [10].

54    It was not disputed that there was considerable factual overlap in the factual allegations made in the proceeding in this Court and those informing the charges in the criminal proceeding: at [19]. The concise statement in the proceeding in this Court described the operation of the respondents’ algorithm by which it brought before its users advertisements which it predicted would be most relevant to them, as well as the ability of users themselves to place advertisements and specify the parameters for targeted users. It also detailed advertisements alleged to have contained fake celebrity endorsements of cryptocurrency, about which the respondents were said to have received complaints and which they had removed from the platform, but were said to have continued to display through another account. Reference was also made to the respondents’ alleged awareness of, broadly, the exploitation of the algorithm by “bad actors”, combined with fake celebrity endorsement, to target users likely to click on the advertisements. It was alleged that despite this, the respondents had failed to take sufficient steps to prevent publication of the fraudulent advertisements: at [20] – [38].

55    In that proceeding, Yates J held that, save for two limited exceptions, the orders sought by the respondents were not necessary to prevent prejudice to the proper administration of justice: at [64]. While the existence of the proceeding in this Court would give rise to media reports linking it to the criminal proceeding, the matters of detail contained in the originating application and concise statement would be unlikely to be subject to wide circulation: at [66]. While the general nature of the allegations would be of wide public interest, these were already in the public domain, forming part of a wider reporting on social media scams, of which this was one example: at [66] – [68]. A media release by the first applicant said to have given rise to the media reporting on the matter set out the basis for the case against the respondents, with all allegations expressed as such, and all largely being coextensive with the allegations in the concise statement: at [69] – [70].

56    Yates J considered that in light of the media release and the existing public commentary on scam advertising on Facebook and other social media, it was not apparent how any publication of the originating application and concise statement could materially prejudice a fair trial in the criminal proceeding: at [73]. Further, any jury trial would not take place until the “relatively distant future”. Any publicity given to the originating application and concise statement would be no more recent than the media release: at [74]. Additionally, the effect of publicity on a jury in the criminal proceeding would be able to be remedied by an adequate direction: at [75]. Finally, the jury would understand that it was the tribunal of fact and appreciate the difference between allegations and facts, and would further be able to appropriately view allegations, even those made by a regulator with model litigant obligations, as allegations only: at [76].

57    As to suppression sought in respect of allegations in the originating application which were not the subject of media reporting, Yates J considered that the mere fact that there was, at that time, a lack of publication, did not mean that non-disclosure of the relevant parts of the originating application was necessary to prevent prejudice to the administration of justice: at [77] – [83].

58    The only documents in respect of which Yates J was prepared to make non-publication and suppression orders were the exhibit to an affidavit, being the “statement of material facts” in the criminal proceeding, in order to “guard against its potential misuse if published outside the confines of the criminal proceeding”. Parts of that document were reproduced in a further document, and on that basis that document was also subject to an order under s 37AF of the FCA Act: at [85].

The Non-publication Order is necessary to prevent prejudice to the proper administration of justice

59    The above-cited cases establish that where there is factual overlap between a proceeding in this Court and a criminal proceeding in another court, suppression orders in respect of documents filed in this Court may be necessary to prevent prejudice to the proper administration of justice. In particular, the filing of documents for the purpose of a proceeding in this Court should not undermine the accused’s rights against self-incrimination and to a fair trial, or reveal the manner in which he or she intends to defend the charges: Gregg at [7] – [8]. Of relevance is also the concern not to “contaminate” the pool of jurors or potential jurors by way of publicity or to compel the disclosure of information that the accused might not be required to disclose in the criminal proceeding: Gregg at [9]; see also BlueScope at [34]. Additionally, suppression orders may be necessary on the basis that the trier of fact may be unable to put out of its mind the involvement of an accused in conduct that is relevant to conduct the subject of a criminal proceeding: Audi (No 4) at [45]. However, the risk of prejudice to a fair trial must not be remote. Further, for suppression orders to be necessary, the prejudice must be incapable of being cured by the usual jury directions: BlueScope at [37].

60    In this proceeding, I considered that the potential prejudice to the proper administration of justice by reason of the possible disclosure of the Findings Schedule meant that the Non-publication Order was necessary. First, there is significant factual overlap between the proceeding in this Court and the criminal charges laid against Mr Prakash. This proceeding arises out of the alleged contraventions set out above at [2], [9] – [11], which broadly are said to arise out of the defendants’ alleged misappropriation of client funds and unauthorised transactions on their behalf. The Findings Schedule produced by the Independent Accountant will ascertain the liability of each defendant to the relevant creditor, identify its capacity to pay, and reconcile intercompany loans. Plainly, doing so will involve the Independent Accountant traversing issues of fact that may be relevant to the criminal charges against Mr Prakash. While by contrast to Gregg, the orders relating to the Findings Schedule do not compel the defendants to provide information or documents to the Independent Accountant, in the event that the defendants in fact choose to do so, then that information or documents might be contained in, or constitute the basis for findings made in, the Findings Schedule. The information or documents would be material that Mr Prakash would not be compelled to disclose in his criminal trial, and therefore the publication of the Findings Schedule and its possible use in the criminal proceeding would prejudice Mr Prakash’s rights to silence and to a fair trial.

61    Second, by contrast to BlueScope and Meta, the risk to the proper administration of justice is not remote. Charges have been laid against Mr Prakash such that, at this juncture, a criminal proceeding is on foot: cf BlueScope at [37] – [38(a)]; Meta at [73] – [75]. Further, the risk of prejudice arises from information and documents, and findings made on the basis thereof, which may directly relate to the charges. The content of the Findings Schedule is likely to remain relevant to the criminal proceeding because it very likely will concern the same facts or conduct which is the subject of the criminal charges. This can be contrasted with the asserted risk in BlueScope said to arise from adverse media coverage and releases which were unlikely to influence jurors’ perceptions of the accused and would fade over time: see BlueScope at [38(b)].

62    Third, the Findings Schedule, which will necessarily arise from information or documents relating to Mr Prakash’s alleged conduct, and be prepared by a professional accountant, would be akin to evidence or findings in relation to that conduct: cf BlueScope at [38(e)]. The contents of the Findings Schedule will not be akin to allegations which are already known to the public (and possibly to potential jurors) by reason of the media attention regarding Mr Prakash. For the reason that the Findings Schedule will contain what are akin to findings, I am not persuaded that members of a jury would be able to distinguish or put out of their minds the conclusions reached by the Independent Accountant and make their own findings of fact as they arise in the criminal trial. Therefore, I do not consider that a jury direction will be able to remedy the prejudice to Mr Prakash’s right to silence or to a fair trial: cf Meta at [73] – [76]. The contents of the Findings Schedule will be materially different to mere allegations made by a regulator or the CDPP in the course of the criminal trial: at [76].

63    In these circumstances, the Non-publication Order was necessary to prevent prejudice to the proper administration of justice to safeguard the integrity of the criminal trial by preserving Mr Prakash’s right to silence and his right against self-incrimination. The Non-publication Order was therefore necessary on the ground contained in s 37AG(1)(a) of the FCA Act.

Two other matters

64    Finally, as noted above at [16] and [21], the Orders provide that the Independent Accountant is to determine whether each of the relevant creditors is secured or unsecured, and to the extent necessary, to reconcile intercompany loans as between the defendants and any related party loans, if any, including securities given between related parties. The basis for the first aspect was that ascertaining whether the creditors were secured would avoid any further dispute in this Court, following the filing of the Findings Schedule, regarding the priority of relevant creditors. As to the second aspect, this would similarly avoid any further dispute in this Court as to which entity was required to pay the relevant creditor. The inclusion of this form of words in the Orders was consistent with ss 37M and 37N of the FCA Act.

CONCLUSION

65    For the above reasons, it was necessary to prevent prejudice to the proper administration of justice to make the Non-publication Order.

Associate:

Dated:    31 August 2026

SCHEDULE OF PARTIES