TerraCom to Pay $5.03 Million in Australian Whistleblower Case

Key Takeaways

• Landmark Enforcement: TerraCom Limited will pay $5.03 million (AUD 7.5 million) in penalties, the first time ASIC has secured an enforcement outcome under Australia’s whistleblower protection provisions.
• Victimization by Disclosure: The Federal Court found that TerraCom’s public statements and shareholder letter in 2020 caused harm to the whistleblower, including reputational damage, distress, and humiliation.
• Legal Costs Added: TerraCom was also ordered to pay $670,000 (AUD 1 million) in ASIC’s legal costs, adding to the financial impact of the case.
• Court Battles Over Privilege: TerraCom fought unsuccessfully to withhold a PwC investigative report from ASIC, with the Full Court ruling the company had waived privilege through its public disclosures.
• Precedent for Compliance: The outcome underscores that corporate communications, even ASX announcements and media letters, can constitute unlawful whistleblower victimization, reinforcing the importance of cautious handling of whistleblower allegations.

Deep Dive

TerraCom Limited will pay a $5.03 million (AUD 7.5 million) penalty after admitting to victimizing a whistleblower, marking the Australian Securities and Investments Commission’s (ASIC) first enforcement outcome under the whistleblower provisions of the Corporations Act.

The Federal Court ordered the penalty following ASIC’s case against TerraCom, which centered on statements the mining company made in 2020 that discredited a whistleblower.

Public Announcements and Open Letter

ASIC alleged that TerraCom harmed the whistleblower through two ASX announcements made on 14 February and 3 April 2020, as well as an open letter to shareholders published in the Australian Financial Review and The Australian on 12 March 2020.

The statements claimed the whistleblower’s allegations were false and that an independent investigation supported TerraCom’s position. In reality, the investigation at least partially supported the whistleblower’s concerns.

TerraCom admitted that its announcements caused the whistleblower detriment including hurt, humiliation, distress, embarrassment, and reputational damage. The company acknowledged portraying him as someone making unfounded accusations for personal gain.

ASIC Deputy Chair Sarah Court said the regulator brought the case to reinforce the critical role whistleblowers play in exposing misconduct.

“ASIC took this case because whistleblowers shed light on important issues. Where corporations engage in conduct that harms whistleblowers, even unintentionally, they risk disincentivizing others from coming forward,” Court said. “Companies should always properly consider and respond to the issues raised by whistleblowers.”

In addition to the penalty, TerraCom has been ordered to pay $670,000 (AUD 1 million) towards ASIC’s legal costs.

A Long Legal Battle

The case has roots in TerraCom’s efforts to restrict ASIC’s access to a PricewaterhouseCoopers (PwC) report into the whistleblower’s allegations.

• In March 2021, ASIC obtained the PwC report through a search warrant at TerraCom’s offices.
• TerraCom sought to prevent ASIC from reviewing the report, but in September 2022 the Full Court of the Federal Court ordered the company to provide it with limited redactions. The Court found TerraCom had waived privilege by making public disclosures about the report.
• In February 2023, ASIC initiated civil penalty proceedings against TerraCom and four of its executives.
• In July 2025, the Federal Court dismissed ASIC’s case against the executives, leaving the company itself to face the penalties.

This is the first time ASIC has successfully pursued a case under whistleblower protection laws, setting a precedent for how Australian regulators may address corporate retaliation.

The decision underscores that even public communications by companies, if harmful to whistleblowers, can amount to unlawful victimization under the law.

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