The ACCC’s charges relate to Chubb Security Australia entering into agreements with clients to provide security services when at the time of entering into the agreements there were reasonable grounds, of which Chubb was aware, for believing that it would be unable to supply all contracted services within the period agreed. 

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The contracts were entered into between 5 June, 2001 and 4 November, 2002, and clients affected were located in <?xml:namespace prefix = st1 ns = “urn:schemas-microsoft-com:office:smarttags” />Sydney, the Gosford region, Canberra and Tasmania.

Chubb Security Australia went before Justice Annabelle Bennett of the Federal Court, in Sydney on June 24 this year and informed the court it proposed to plead guilty to the charges. At that time Justice Bennett listed the matter for one day’s hearing at 10.15am on October 15 to “determine the appropriate penalty”.

While there’s as yet no mention of the hearing on the ACCC’s website, industry association ASIAL reported in its online newsletter last week that “On Friday 15th October 2004, Chubb Security Australia pleaded guilty in the Federal Court (this actually occurred on June 24, we believe) to charges of contravening the Trade Practices Act.”

ASIAL’s newsletter noted that Justice Bennett “will hand down her decision in the coming weeks.” More interestingly, the newletter reported that an independent panel appointed by the ASIAL Board had put forward options and recommendations on how the Association should handle this matter, including a possible “package of sanctions”. This panel is completing its task and will shortly report back to ASIAL’s national executive council, the newsletter said.

This is a watershed case for ASIAL and the NSW licensing model, which is run at arms length by the NSW police service. While small organizations, security officers and security managers have all lost their security licenses, had their association memberships terminated and been denied the right to earn a living in the security industry, some for relatively minor infringements, bigger corporations have up to this point, sailed through serious crimes entirely unscathed.

The crimes of bigger organisations have variously included misleading customers, failure to provide services that have been paid for and price collusion, among other things. Despite charges in Australian courts, none of the major organizations (and none of their senior officers) has ever been denied the right to continue operating in the security industry. Conversely, SNW is aware of a security manager whose license was cancelled by the Security Industry Registry, even though no charge was recorded against him in a misdemeanor hearing.

And there’s another telling factor in the case. A raft of recommendations has just been handed down that will upgrade the Security Industry Act in NSW, significantly broadening the numbers and types of people and companies who may now be required to operate under its rules.

In light of these recommendations, a failure to adequately prosecute in this case will be seen as a failure of the Act by a majority in the security industry, many of whom have long felt NSW licensing raises revenue without a balanced policing of the Act.