On 5 March 2026, Justice Lee of the Federal Court handed down his much-anticipated decision in ASIC v Bekier (Liability Judgment) [2026] FCA 196. The case arose from cascading governance failures at The Star Entertainment Group and resulted in findings that its CEO, Matthias Bekier, and its General Counsel and Company Secretary, Paula Martin, each breached their duties of care and diligence under section 180(1) of the Corporations Act 2001 (Cth). ASIC’s parallel case against Star’s non-executive directors, by contrast, was not made out.
The decision is required reading for directors, general counsel and governance professionals. It is a case study in how the same statutory obligation plays out differently depending on the information a person holds, the role they occupy and the moment at which they are required to act. The decision also provides useful guidance on the use of artificial intelligence in boardrooms at a time when boardrooms are looking to implement AI.
Findings against Bekier and Martin
At the heart of the case was what can be labelled as ‘Risk Information’. This was information that both Bekier and Martin gained over time related to serious money laundering and criminal activity risks associated with Star’s dealings with junket operator[1] Suncity, the conduct occurring in Star’s private gaming room Salon 95 and the use of China UnionPay (CUP) cards in a manner that misled Star’s banking partner, NAB.
Justice Lee found that both Bekier and Martin had received and appreciated this Risk Information,[2] and that a reasonable person in their positions would have done two things they failed to do: escalated the matters to the Board, and recommended that the Board direct management to suspend or terminate Star’s relationships with Suncity and two of Suncity’s gambling customers until satisfactory probity information was obtained.[3]
Notably, Mr Bekier gave evidence that he had not informed the Board that NAB had been misled as to the use of CUP cards at Star because he was informed during the COVID-19 pandemic and this was his primary focus at that time. While acknowledging the reality of the pandemic risks, Justice Lee found that they did not relieve Mr Bekier from having to pay appropriate attention to other risks as they arose.[4]
For Martin, the findings were compounded by her role in relation to the CUP issue. She had received a letter from NAB seeking confirmation that CUP card transactions at Star did not include a gambling component. She instructed a junior solicitor to draft a response, reviewed it, and approved its sending, despite knowing the representation that Star’s CUP card process did not include a gambling component was false.[5] Martin did not bring the issue to the Board. The Court rejected her submissions that she had no obligation to act because others already held the same information and that her reporting obligations were confined to what the Board had specifically requested.[6]
Allegations against Bekier that were not made out
Justice Lee also considered a series of ASIC allegations against Bekier that were not made out.
In late 2017, Bekier read a board paper that included a ‘World Check Report’ identifying that a major junket customer had been detained in China some years earlier for alleged money laundering. Bekier did not recommend to the Board that the relationship be terminated. Justice Lee found that, at that point in time, the money laundering allegations were unverified, Star’s legal team was aware of the report, and the regulator had not raised concerns despite frequent contact with Star.[7] Therefore, the risk, though present, was not so material as to demand escalation.
Similarly, Bekier’s approval of resolutions increasing credit limits for two gambling customers was found not to breach his duties. He had reasonably assumed that those responsible for suitability assessments were doing their jobs and would have flagged any concerns. Recent regulatory reviews also affirmed Star’s approach, and the resolutions presented a genuine commercial opportunity for Star.[8]
The contrast between these findings and the findings of breach is informative. Each presents an example of the director receiving information but not escalating it, with one instance found by the Court to be a breach and the other found not to be. The differences are attributable to the detail of the specific information and the surrounding context at the specific time of its receipt. This illustrates that assessment of potential breaches of a director’s duties is undertaken by reference to what they know at the point of decision.
Non-executive directors: not liable, but not without criticism
ASIC’s case against Star’s non-executive directors was unsuccessful. Focusing again on what they knew and when, the Court found that by the time they received the Risk Information, management had already agreed on some remediation actions,[9] was still investigating certain allegations and was under instructions to keep the Board informed,[10] the issues were not presented to the Board as significant compliance failures and there were no subsequent reports indicating that a problem persisted.[11]
But, while section 180(1) does not demand omniscience or perfection, Justice Lee observed that the documents before the Court did not depict directors actively pressing management with difficult questions or showing sustained scrutiny in circumstances where risks were obvious.[12]
The takeaway for non-executive directors is that while they can rely on management to bring information and matters to their attention, they should not be passive and should seek to ask necessary and difficult questions of management.
Guidance on the use of AI in boardrooms
Justice Lee also recognised the impact of the use of artificial intelligence in boardrooms and the ‘considerable potential for AI, if appropriately utilised, to assist directors in the discharge of their duties’.[13] His Honour warned against directors becoming ‘passive recipients of information’ from over-reliance on AI, with ‘electronic document dumps masquerading as board packs’.[14] His Honour emphasised that ‘[i]t is the responsibility of directors to ensure that [the use of AI] occurs in a responsible way, guided by Middleton J’s caution that a board can control the information it receives’.[15] After all, ‘[t]he statutory obligation imposed by s 180(1) remains personal, and it requires informed human judgment’.[16]
[1] A “junket” is a high-risk, short-term gambling program arranged between a casino operator and a third-party promoter who brings high-wealth players to the casino.
[2] As to Bekier: at [1377]-[1379], [1417], [1442]-[1447]. As to Martin: at [1568]-[1593], [1659]-[1671], [1706]-[1742].
[3] As to Bekier: at [1398], [1431], and [1460]-[1461]. As to Martin: at [1617].
[4] At [1504].
[5] At [1752], [1758] and [1761].
[6] At [1682] and [1690]-[1691].
[7] At [1352]-[1356].
[8] At [1323]-[1334].
[9] At [1816].
[10] At [1817]-[1818], and [1861]-[1870].
[11] At [1832]-[1842].
[12] At [1951].
[13] At [393]
[14] At [1956].
[15] At [394].
[16] At [1956].
