Areas of Law Relevant to the Media Report - Coursework Example

Media Report Analysis Name: Institution: Date: Word Count: 1886 Media Report Analysis This paper analyses Taylor and Knowles’ (2014) media report on the fraud case against Michael Le and Canh Le.1 The report was about the sale of properties owned by the Le family owing to investigations of fraud against the market gardeners. The family’s 9 properties including commercial and residential properties were listed for sale in the market by Thomas Massam, the estate agent. The property sale aimed to reduce the running costs of the properties after the Le brothers were charged for money laundering. The charges came after the Federal and State authorities raided the homes in search of evidence of illegal working rackets.2 The raids caused the Les brothers to lose a supply contract with Woolworths. The report states that Michael Le had denied an interview request but said that his company had not done anything wrong despite losing customers and suppliers in the raid. Despite his claim of innocence, the Thang Le Family Export Company had to sell off its properties including a market garden in Carabooda. The Safari residential place was also subject to anti-fortification because the authorities suspected that it was used for organized crime activities. The premise of this media analysis is to examine and discuss areas of law, which are relevant to the report, the significance of the law to the parties involved and the influence of media on public opinion about the law. Areas of Law Relevant to the Media Report The case in the report reveals a number of areas concerning Australian law. These are corporate law, contract, real estate, fraud, and organized crime. Corporation law is defined in the Corporations Act. The features of corporate law in Australia include registration of a company, appointment of company officers, meeting of directors, issuance of securities, transfer of company shares or assets, takeovers, insolvency, liquidation, debt finance, foreign investment, party transactions, and Australian Securities Exchange listing.3 New South Wales corporate law on the appointment of company officers states that the directors of a company should understand their responsibilities, liabilities, and rights when consenting to their appointment to the firm. The application of the Corporations Act presumes that the directors of the Le Family Export Company understood their responsibilities when they presented their written consent their appointment. These responsibilities include acting in good faith, acting in the best interest of their company, exercising diligence, preventing company trading when the company is unable to pay debts, and not using information obtained as directors. The Le directors contravened this law because the raids by Federal and State authorities suggest that Michael and Canh Le did not act in good faith or in the best interest of their company. The media report shows that the directors conducted worker racket activities in the firm. The directors did not exercise due diligence in managing their supply contracts to supermarkets and clients. This explains why supermarkets were fearful of purchasing the family’s fruits and vegetables.4 In addition, the directors failed to act in good faith by having the farmers perform all of the labor and share a percentage of the sales.5 Contract law is also relevant to the firm’s operations. The family business had a contract with non-skilled workers at the farm. The farmers provided labor for growing vegetables such as cherry tomatoes, broccoli and Brussels sprouts in exchange for 50 percent of net sales. The company developed infrastructure for the export business and sought visas for its non-skilled farmers.6 The anti-fortification notice for organized crime suggested that the company did not adhere to the contract conditions with its farmers. Another relevant area is fraud and organized crime. Laws on these areas include the Corporate Law Economic Reform Program, the Criminal Code Amendment Act and the Anti-Money Laundering and Counter Terrorism Act.7,8 The Fraud and Corruption Control regulation provides guidance for controlling corruption and fraud while the Criminal Code Amendment Act states that it is an offense to make an offer to influence public officials for business advantage. The Anti-Money Laundering and Counter Terrorism Act restricts anti-money laundering activities.9 The media report reveals the charges against the Le family involved organized crime and the raids by the Australian authorities on the family’s estates. Real estate is also relevant to the law. Australia’s Property Law Act 1969 is concerned with obtaining land titles, ownership, neighbor relations, land dealings, and the nature of the property. The property law guided the sale of Le properties in the report including the market garden at $2.72 million and five properties at 20 percent less than valuations from the company financiers.10 Functions of the Law in the Report The law functions in diverse ways. Firstly, it provides predictability. For instance, section 180 of the Corporations Act states that the directors of a company should exercise their powers with diligence including maintaining proper financial records and ensuring that the financial statements provided a fair view of the company’s financial position.11 The raids by the Australian authorities and organized crime charges suggest that the Le family did not maintain accurate and fair records of their financial position and that the directors were not diligent in discharging their duties. Secondly, the law promotes and dissuades conduct. The Corporations Act dissuades company directors’ misuse of information or position, conflict of interest or conduct trading when the firm has debts.12 From the report, the Le company directors contradicted this law by misusing their position to engage in organized crime. Thirdly, the law empowers individuals and people with certain powers and rights. In the media report, contract law empowered the Le family company to exploit farmers for labor in exchange for produce.13 The company asserted it was obliged to train its workers and improve accessibility to technology but it was targeted by authorities while other large Australian farms relied on non-skilled immigrant workers for labor.14 Fourthly, the law imposes certain obligations on organizations and individuals to ensure that they meet legal responsibility. The Anti-Money Laundering Act and the Corporate Law Economic Reform Program Act 2004 imposes certain legal responsibilities on organizations and company officers with regards to misconduct and anti-fraud. The Le family company failed in this obligation because the report states that the authorities had charged two brothers with organized crime. This crime could include enabler activities such as money laundering, business exploitation, human trafficking, and mass-market fraud. Fifthly, the law enforces certain rights and duties. The Property Law Act enforces rights on the sale and valuation of properties, which guided the sale of Le’s 9 properties in the market at 20 percent less than the bank valuation.15 Lastly, the law provides any remedies for injustices. The Criminal Code Amendment provides remedies for criminal injustices by company officers. These remedies include the criminal prosecution of Michael and Cahn Le by the Australian authorities. Importance of the Law to the Parties The relevant parties needed to know the law because it would have provided an advantage when seeking remedy for their lost securities. It was important that the directors of the Le Family Export Company knew the law on property, organized crime and the duties of company officers. If the directors knew about property law, they would have taken measures to control the liquidation of their real estate assets. Their knowledge of property law would have prevented the company from selling its assets at discounted prices.16 In addition, knowledge of this law would have helped the Le family to reduce the running costs of the properties by leasing or renting to the public. Knowledge on organized crime law would have helped the directors to distinguish between legal and illicit activities. This knowledge would have empowered the directors to avoid engaging in illegal worker activities and organized crime as alleged by the Federal and State authorities.17 It would have helped the directors to desist from participating in organized crime networks and to develop a strategic framework for ethical practice. This would have helped Michael Le and his family to provide ethical leadership in fraud control and to maintain competitive advantage in the horticultural business. Lastly, knowledge on the duties and responsibilities of company officers under the Corporations Act would have helped the Le Export company directors to understand their obligation to the business, customers, employees, suppliers, and the government. These responsibilities include acting in good faith; ensuring that all decisions were in the best interest of the export company; avoiding conflict of interest between the directors and the company; not exploiting information for selfish gains; and exercising due care.18 Furthermore, knowledge of the Corporations Act was important for the directors of the Le Export Company because they would understand that breach of the obligations would be reasons for disqualification, fines, compensation orders, or imprisonment. Based on the report, the charges for money laundering reveal that the directors of the company breached their legal obligations to the Le Export Company, which warranted criminal prosecution and possible imprisonment.19 Knowledge on Corporations Law would have made the directors aware of the criminal penalties of their misconduct. Media Influence on Public Opinion about the Law Media influences public opinion on the law. The media report on Michael Le and the family company focused on the sale of properties owning to liquidation problems. The report stated that the family had listed quarter of the real estate portfolio for sale. This would encourage interested buyers to look into the properties for discounted prices. In addition, the report stated that the Les had been charged with money laundering. The charges affected the company because customers and supermarkets were unwilling to purchase produce.20 This shows that media reports on the case had a negative effect on the company sales. Media had a negative influence because supermarkets and customers were scared to transact with the export company. In addition, media influenced public perception about money laundering.21 It created positive public opinion by showing that Australian authorities were keen on illicit activities and imposed charges on individuals who engaged in organized crime such as Michael and Canh Le. The report influenced public opinion on organized crime by making citizens aware of illicit activities in the horticultural business. Conclusion The purpose of the media analysis was to examine and discuss areas of law, which are relevant to the report, the significance of the law to the parties involved and the influence of media on public opinion about the law. It report discussed five areas of law namely corporate law, contract, real estate, fraud and organized crime. The concerned laws were the Corporations Act, Corporate Law Economic Reform Program, the Criminal Code Amendment Act and the Anti-Money Laundering and Counter Terrorism Act, the Fraud and Corruption Control Regulation and the Australia’s Property Law Act. These laws provided predictability; promote and dissuade conduct; empower the Le directors with certain powers and rights; impose certain obligations on the Le Export Company directors to ensure that they meet their legal responsibility; and provide remedies for injustices such as money laundering. The analysis has shown that it was important that the directors of the Le Family Export Company understood the laws on property, organized crime and the duties of company officers. Furthermore, the law is important to the parties because it would have helped them to sell their assets at greater prices, to desist from illicit activities (such as money laundering) and avoid breaching the duties and responsibilities of company officers. Bibliography Commonwealth of Australia. Fraud control in Australian government entities. Canberra, ACT: Australian National Audit Office, 2011. Accessed August 5, 2014, http://www.anao.gov.au KPMG. Fraud risk management: Developing a strategy for prevention, detection and response. Switzerland: KPMG, 2013. Accessed August 5, 2014. http://www.kpmg.com/CH/ NSW Young Lawyers. A practitioner’s guide to corporate law: A guide to basic procedures of corporate law for young lawyers. Sydney, New South Wales: Law Society of NSW, 2007. Taylor, Grant and Gabrielle Knowles. “Carabooda properties up for sale.” The West Australian, January 16, 2014, 9. Tobin, Hugh. “Better communication with vegetable growers with a language other than English”. Rural Industries Research and Development Corporation (2010): 1-35. Read More