TerraCom Limited will pay a $7.5 million penalty for whistleblower victimisation after Federal Court proceedings brought by the corporate regulator, in what ASIC says is its first enforcement outcome for contraventions of the whistleblower provisions. The company has also been ordered to pay ASIC’s legal costs of $1 million.
The case centred on two ASX announcements by TerraCom on 14 February 2020 and 3 April 2020, and an open letter to shareholders published in the Australian Financial Review and The Australian on 12 March 2020. Those communications stated the whistleblower’s allegations were false and that TerraCom had independently investigated the conduct of its employees.
In court, TerraCom admitted the publications caused the whistleblower hurt, humiliation, distress and embarrassment, and damaged his reputation by portraying him as willing to make unfounded accusations for personal gain, despite an independent investigation at least partially supporting his allegations.
ASIC Deputy Chair Sarah Court said, ‘ASIC took this case because whistleblowers shed light on important issues. Where corporations engage in conduct that harms whistleblowers, even unintentionally, they risk disincentivising others from coming forward. Companies should always properly consider and respond to the issues raised by whistleblowers.’
TerraCom is an ASX-listed miner that operates the Blair Athol coal mine in Clermont, Queensland, and has operations in South Africa.
The ruling follows extended litigation over a PriceWaterhouseCoopers report commissioned by TerraCom to probe the whistleblower’s claims. After ASIC obtained the report under a search warrant in March 2021, TerraCom moved in August 2021 to stop the regulator from reviewing it. In March 2022, Justice Stewart found the company had waived privilege over the report through its public disclosures, and in September 2022 the Full Court ordered TerraCom to provide ASIC with a copy subject to court-approved redactions.
ASIC launched civil penalty proceedings in February 2023 against TerraCom and four individuals — Mr McCarthy, Mr Boom, Mr King and Mr Ransley. On 7 July 2025, the Federal Court dismissed the proceedings against the current and former officers, while the case against the company has resulted in the penalties announced.
