Paul McIntyre: Field-day for market knockers

Industry stone-throwers were in full swing this week as a bank came clean on overcharging A$80 million in fees to customers, a blue chip board director was banned from company directorships for 10 years, and the top corporate regulator was accused of going soft on white-collar crime.

To top it all off, Macquarie Bank, dubbed the "millionaires factory", copped a bollocking at its AGM for paying salaries of A$90 million to its top seven executives last year.

At the top of the heap though was Steve Vizard, one-time top-rating TV show funnyman, who has dominated the headlines for three weeks.

It all culminated on Thursday in a scathing judgment from Federal Court judge Ray Finkelstein, who ruled Vizard had engaged in "dishonest" conduct when buying shares with inside knowledge when he was a board director of Telstra. Justice Finkelstein said Vizard's behaviour amounted to a "gross breach of trust". The judge banned Vizard for 10 years from company directorships along and fined him A$390,000 - a figure Justice Finkelstein said was too low but unable to change.

"But for the fact that Telstra did not suffer any loss, the defendant's actions would have been within the category of a worse case offence of this type," he said. "Any slip from the high standards demanded of a director can put at risk the company, its investors and - in extreme cases - the economy."

Vizard has suffered a huge fall from grace. A decade ago he was frontman for the top comedy show Fast Forward and hosted his own live TV show. He was also anointed Father of the Year and was deeply involved in charities and the arts. But Justice Finkelstein said Vizard's share activities were motivated by greed, and doubled the directorship ban of five years that the Australian Securities and Investments Commission recommended.

And for its troubles the commission is now in the firing line for opting for a civil trial against Vizard rather than criminal charges: based on the Federal Court's judgment, Vizard would have gone to jail under criminal charges.

The commission's critics say it opted for the easier path because Vizard had the money for a bigger fight in the courts in a criminal case, reinforcing a view that the wealthy and high-profile will receive different treatment to those less resourced.

The commission's acting chairman, Jeremy Cooper, rejected the claims on Thursday. "I would not like to be standing here having lost a criminal prosecution telling you Mr Vizard has been acquitted and got off scot free," he said after the ruling.

The commission was joined by the National Australia Bank and Macquarie Bank in this week's round of public lashings.

NAB boss John Stewart fessed up to a bungle involving 200,000 customers it overcharged over the past 20 years - the A$80 million botch will cost the bank A$110 million to fix, and follows a A$360 million foreign currency trading scandal last year.

Stewart was quick to point out that the problems arose from past management regimes, and then handed over to the head of Australasian business, Ahmed Fahour, to plead for forgiveness.

"We have erred and erred for a long time," he said. "We are very sorry and we will make good for this error."

It's not flash news for the NAB, which has made much of its new focus on customers, using a major sponsorship of the Melbourne Commonwealth Games to tell Australians it is hellbent on a new customer-focused culture.

Finally to Macquarie Bank. Directors were in the vice on Thursday over the $90 million its top seven managers were paid last year.

"Macquarie has crossed the line, at least by the standards of retail investors," said the chairman of the Australian Shareholders Association, Stephen Matthews, claiming "unbridled wealth" might "cloud" management's judgment.

But after a lot of huff, Macquarie chairman David Clarke stood firm: "You may or may not agree with what investment bankers get paid around the world, but the bank is totally dependent on its people."

Those same people have pushed Macquarie to the most expensive stock in Australia's top 500, trading around A$64 a share. In January it was hovering around A$50.

Someone's doing something right.

* Paul McIntyre is a Sydney journalist