Prosecutors have abandoned a long-running criminal cartel case against ANZ and one of its senior executives, Rick Moscati, after the Federal Court described the matter as a "complete shemozzle".

The court also said the committal hearings — where a magistrate decides whether there is sufficient evidence to take the matter to trial — were "long, drawn out and ultimately ... fairly pointless".

In an embarrassing blow, the Commonwealth Director of Public Prosecutions (CDPP) was ordered to refile its indictment, for a third time, because it was "deficient and defective".

Despite the setback, the CDPP has decided to proceed with its criminal prosecution against banking giants Deutsche Bank and Citigroup, which are also defendants in this matter.

Criminal test case

In June 2018, ANZ, Deutsche and Citi were prosecuted for being "knowingly concerned in alleged cartel conduct".

It is essentially a form of alleged collusion — and the matter was the result of a two-year investigation by the competition watchdog, the Australian Competition and Consumer Commission (ACCC).

This case arose from ANZ's decision to raise extra cash from institutional investors, by issuing $2.5 billion worth of new shares in August 2015.

Citi, Deutsche and a third major global bank, JP Morgan, through some of their most senior executives, allegedly came to an understanding on what to do with any shares that were unable to be sold.

Often, there aren't any left over — but this time almost a third of the shares, worth about $790 million, did not sell.

JP Morgan is not facing charges because it blew the whistle and was granted immunity.

This is seen as an important test case because criminal cartel charges have never been brought against an Australian company before.

For companies, the maximum fine for each offence is either $10 million, or three times the total benefits that have been earned and are "reasonably attributable" to the commission of the offence (whichever is greater).

For individuals, the maximum sentence is 10 years in prison, a fine of up to $420,000, or both.

'Complete shemozzle'

Justice Michael Wigney did not mince words when he criticised the prosecutor's handling of the case on Wednesday morning.

The judge also said it was "entirely unsatisfactory" that the indictment had not been finalised — three years after the banks and their executives were first charged, and about six months before the trial was due to commence.

The CDPP filed its first indictment (which outlines the criminal charges) against the banks and its executives on February 1.

But it was ordered to file a new indictment by July 7 because the charges were poorly explained and "defective" — partly because of the "complex nature" of Australia's cartel legislation.

The same thing happened again on Wednesday's hearing (November 3). In a brief summary of the judge's decision, the Federal Court noted:

"The accused argued that the charges did not sufficiently describe the nature of the offences that they were alleged to have committed because, for the most part, the charges were entirely bereft of particulars and simply repeated the words of the relevant offence provisions."

Justice Wigney decided to give the prosecutor a third chance — and a November 24 deadline to file yet another set of indictments.

Instead of trying again, the CDPP decided to abandon its case against ANZ and Mr Moscati, but is pressing ahead with its prosecution of Deutche and Citi.

In a statement, ANZ's chief risk officer Kevin Corbally said: “We maintained all along ANZ acted in accordance with the law in relation to the placement.

"We defended the bank and Rick on that basis and we are pleased the matter is now behind us."