In the Federal Court judgment in ASIC v Latitude Finance Australia (No. 4) [2026] FCA 989, delivered on 28 July 2026, Justice O’Bryan imposed penalties of $20 million on Latitude Finance Australia and $35 million on Harvey Norman Holdings Limited for misleading or deceptive advertising.
While the companies pay these fines directly, the real cost falls on their shareholders. Fines reduce company profits, lowering funds available for dividends or reinvestment, which ultimately diminishes shareholder returns.
Harvey Norman is an ASX-listed company with a market capitalisation of approximately $6.01 billion. Latitude Finance is a subsidiary of ASX-listed Latitude Group Holdings (market cap ~$946 million). Their shareholders include hundreds of thousands of Australians who invest directly or indirectly through superannuation funds and index funds. Super funds investing in ASX 100 or All Ordinaries Indices (or similar) would hold positions in these two companies, so all their members would in effect be shareholders in these two companies.
These ultimate investors —who were not involved at all in the advertising decision—bear the full $55 million cost, while the individuals who were responsible for it face no personal penalties. That makes no sense at all.
Also, the judgment identified no customers who suffered financial loss. No one claimed they were unaware of the fees or would have avoided the contracts had they known. The case rested on the possibility that some customers may have been inconvenienced. A $55 million penalty for possibly inconveniencing some potential customers is absurd, it is grossly disproportionate.
I can understand a court ordering restitution, compensation for financial loss, but not a draconian penalty – and especially not such a draconian one inflicted on innocent folk. It is bewildering that a Federal Court judge could think it appropriate.
O’Bryan’s decision is totally unacceptable and frankly shows our Federal Court acting as a quango assisting our Commonwealth Government steal $55 million from a multitude of innocent Australian citizens, who would be oblivious to it.
We need to change the law, change the penalty, change who pays it and ensure our judiciary is held to account for unfair decisions. A Classic Liberals government will ensure the necessary changes are made.
Written by: Mark M.J. Morris (July 2026)