ASIC gets serious with jail time

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A former Bell Potter Securities adviser who pleaded guilty to dishonest conduct involving more than $1.7 million has had his original suspended sentence quashed and been jailed for one year by the NSW Court of Criminal Appeal.

The court today sentenced Lawson Stuart Donald to two years jail to be released after one year.

Commenting on the original suspended sentence, the court said:

'... the sentence failed to reflect the gravity of the offence and failed in particular to serve as an effective deterrent to other similarly intelligent, competitive professionals in the financial markets...'

Following an ASIC investigation, Donald was found to have dishonestly used his position as an employee of Bell Potter with the intention of directly or indirectly gaining an advantage for himself, or someone else, by rebooking share trades, or transferring trades from one client account to another.

In April 2013 Donald, a former first-grade captain at Sydney’s Randwick District Football Club and Australian Barbarians player, received a suspended jail term upon entering a good behaviour bond.

The Commonwealth Director of Public Prosecutions, in consultation with ASIC, appealed the sentence including on the basis that it was manifestly inadequate.

The court added:

'It has also been repeatedly observed that the real bite of general deterrence takes hold only when a custodial sentence is imposed ... notwithstanding judicial statements to the effect that a suspended sentence is a sentence of imprisonment, the community (including those in ‘white collar’ occupations) might be justifiably forgiven for thinking that an offender who is serving a bond in the community has escaped meaningful punishment.'

ASIC Commissioner Greg Tanzer said, “Our financial system relies on gatekeepers like advisers doing the right thing so investors can be confident when they participate in the market.

“This sentence recognises the seriousness of Donald’s conduct and will serve to deter others from engaging in similar behaviour.”