The Full Federal Court has largely dismissed appeals by former ASX-listed payments company iSignthis, now known as Southern Cross Payments, and its former director and chief executive Nickolas Karantzis, upholding penalties of $11 million in a case ASIC launched almost six years ago.
The decision
In a judgment handed down on Monday 2 November, Justices Stewart, Cheeseman and Neskovcin upheld orders that iSignthis pay a $10 million penalty for breaching disclosure laws, and that Mr Karantzis pay a $1 million penalty and be disqualified from managing corporations for six years. The appellants were ordered to pay ASIC’s costs of the appeal.
They succeeded on one limited point: the terms of one declaration made against Mr Karantzis must be amended. The judges said that correction “could have been raised before the primary judge, and its correction does not alter any substantive liability or penalty outcome”.
On the company’s penalty, the court said: “The relevant harm included harm to the integrity and proper operation of the market and was not confined to demonstrated financial loss suffered by an identified shareholder.”
The original findings
In June 2024, Justice McEvoy found iSignthis had engaged in misleading or deceptive conduct by representing on 3 August 2018 that less than 15% of its fourth-quarter revenue came from one-off or set-up fees, and had breached its continuous disclosure obligations by failing to disclose that it had recognised about $3 million in one-off and non-recurring revenue and about $2.85 million in one-off costs in that quarter. He also found the company failed to disclose, from 12 May 2020, that Visa had terminated its relationship with it, or Visa’s reasons.
Mr Karantzis was found to have breached his duty of care and diligence and to have failed to take reasonable steps to ensure what he told the ASX about the Visa termination was not false or misleading. Justice McEvoy found ASIC had not made out its allegation that he breached his duty to act in good faith, and ASIC did not appeal that part of the ruling. Penalties were imposed in August 2025.
The regulator’s message
“Investors are entitled to trust what listed companies tell the market. There is no room for spin,” ASIC Chair Sarah Court said. “Accurate and timely disclosure goes to the heart of market integrity. When that obligation is not met, it can undermine investors’ ability to make informed decisions and erode confidence in our markets.”
Why it matters for boards
The court’s observation that market harm is not limited to provable shareholder losses is significant for listed companies and their directors. It confirms that penalties for disclosure breaches can be substantial even where no individual investor loss is identified, and that questions from the ASX need accurate, complete answers.
Sources: ASIC media release, “Federal Court upholds $11 million in penalties and disqualification against iSignthis and former director and CEO Nickolas John Karantzis” (26-267MR, 3 November 2026); Business News Australia (3 November 2026).
This article is general information only and is not legal advice. Readers should seek advice specific to their circumstances.