Jonathan Moylan sent an email that wiped 300 million off a mining company’s value. “I’ll just do what people do every year on April Fools’ Day,” he says he thought at the time.
Moylan is an anti-coal activist from Newcastle. In early 2012, he set up a camp outside the Maules Creek mining site to protest against the mine and protect the Leard State forest. “You hear about the prospects for the future and think, ‘I can either let this happen or I can do something about it.’”
The Maules Creek mining project is seven hours northwest of Sydney, and is one of the most controversial mines in Australia. Whitehaven Coal earmarked 760million to build and open the project. The open cut mine would threaten the native plants and animals of the surrounding region.
“If this was an underground mine we wouldn’t have an issue. But it’s open cut, it’s in a critically endangered forest, and more than anything else, it’s going to take the water away,” says Moylan.
Local farmer Cliff Wallace also opposes the mine. “It doesn’t matter what they do, if they continue their mining practices, the water is going to be polluted. You’ve got one group that’s trying to save your water, your soils, and your trees, you’ve got the other group bulldozing as fast as you can knock it down.”
With the aid of nothing more sophisticated than a mobile phone and a laptop, Moylan put out a fake press release stating that ANZ had pulled their funding from the project on ethical grounds. He found a logo on the bank’s website, used the name of an ex-employee, and his own phone number.
Journalist Ben Cubby followed up the release. ““It was reasonably convincing. I thought that it looked like an interesting story there.” Cubby rang Moylan, who repeated the fake name. “I just repeated the lines that were in the media release, and he said ‘look this could be a big story, I’ll call you back later.”
Cubby broke the story on Twitter, but it raised some alarms with Cubby’s editor, who happened to know the employee Moylan was impersonating. Within ten minutes the hoax had been discovered, Cubby deleted the original tweet and issued a correction. The Australian Financial Review, Business Spectator, and AAP all ran the story without contacting Moylan.
The share value of Whitehaven Coal plummeted, losing $316 million within hours. Moylan remembers thinking, “that’s going to get me in to a little bit of trouble”.
Two days later ASIC raided his camp and confiscated his laptop and phone. Two days later he was charged with making a false and misleading statement under the Corporations Act. He pleaded guilty and was sentenced to twenty months in prison, but was released with a two year good behavior bond. Moylan was relieved. ” I was expecting a very harsh sentence. Some of the people would like to see me chucked in there for 10 years,” he says. While angering the business community, Moylan also became a hero of the environmental movement.
Stephen Galilee, the CEO of the NSW Mineral Council, was disappointed in the lightness of the sentence. “It was disappointing for us to see a relatively light sentence handed down because a strong signal should have been sent that this was a serious act.
“This was a planned and premeditated act. It was well researched. And he went about it in a very premeditated way. The idea that this was just some kind of innocent experiment in public relations should be completely rejected.”
QC David Galbally agrees. “I think that his actions are very sinister… We should have specific legislation in the Crimes Act detailing that this sort of conduct carries with it jail terms. People should understand that they cannot go about disseminating this false material. If you undertake an activity that is full of falsity, you must think through the consequences. And if you don’t think through the consequences and you don’t care, then you are extremely reckless in your behavior, and the law looks at that as being akin to an intentional action.”
Moylan claims he never thought that the company’s value would be affected, merely wanting to draw the attention of ANZ’s customers to how their money would be invested.
Moylan’s mother, Marion, places some of the blame on the media. “It’s the job of a journalist to check their sources, and they didn’t. They just wanted to be first with the news, and they never got in trouble for anything.”
Cubby denies that the responsibility should fall solely on the media. “There will be people out there saying that media are much more responsible for people losing money than Mr Moylan, but at the end of the day if you make a conscious, premeditated decision to lie to a journalist and then try and conceal those lies, you should take some responsibility for that as well.”
Moylan’s commitment to activism remains. “I’m going to stick with it. I’m going to keep being involved with the movement. Whatever it takes.”
His mother has also joined the fight. “I like to think it has improved our relationship,” she says. “I think he was very proud of me when I got arrested. I thought, ‘okay, that is one thing I’ve done in my life I didn’t think I’d do’”.
Galilee sees the protests as a threat to the local economy of the region, where unemployment is 7.5% per cent. “There are some local people who have concerns, but it is a reasonable observation to make that there are a lot of outside activists coming in to these areas, whipping up trouble, and dividing local communities. In that region, mining is using less than 1/10th of 1% of the land, compared to 70% for agriculture, so the idea that mining is taking over the region is not borne out by the facts.”
“We have twenty thousand mining families across NSW who rely on the coal industry for their livelihood. He is campaigning against the jobs of those people and their families. That’s an act of economic vandalism in my book.”
Moylan defends his tactics. “We’re up against a multibillion dollar coal company that’s run by some very powerful people, so of course we need determination. What we do needs to match the reality of what we’re facing. Whatever it takes.”
Wallace supports the actions of the protestors. “There’s over eighty to ninety thousand acres on the other side of the mine being bought up by one company. They’re shutting us down. I’ll never sell. I won’t sell my farm, and I won’t sell my soul.”
STATEMENT FROM AUSTRALIAN SECURITES AND INVESTMENT COMMISSION
Jonathan Moylan says he had no knowledge of the financial impact his press release would have. While the press release made a temporary impact to the share price of Whitehaven Coal, the company recovered most of its losses. With this in mind, does ASIC stand by its case against Jonathan Moylan and why?
ASIC stands by its action. ASIC is all about ensuring investors - the millions of Mums and Dads with superannuation - can have trust and confidence in our financial markets and that is why we took action against Mr Moylan.
· Some say that ASIC has failed to pursue “more serious” types of insider trading and instead pursued Moylan because he was an “easy target”. What is your response to that?
ASIC pursues hundreds of enforcement matters each year and they are all serious. Our actions are about upholding investor trust and confidence in the integrity of our markets.
· Some legal experts believe the sentence delivered to Moylan was too lenient and that his crime should come under the Crimes Act, not the Corporations Act. Are you satisfied with the sentence delivered to Moylan and do you believe moving this crime under the Crimes Act would deter more people from committing this crime?
We are satisfied with the sentence.
· Some media organisations published Moylan's press release without checking the information with official bodies such as the ASX. Should the media share some of the blame for the financial losses of Whitehaven Coal and why did ASIC not pursue a case against these media organisations?
We have no comment on the standards of journalism in Australia.
· How concerned is ASIC about copycat hoaxes in the future and what has been put in place to ensure it doesn’t occur again?
Our action in the Moylan case was certainly about sending a message that we take the integrity of Australia's financial markets very very seriously.