WHITE-COLLAR crime should not attract steep criminal sanctions, according to one criminologist in the field, but lenient sentencing in Australian courts has long attracted criticism.
Former Gunns head John Gay is facing a possible prison sentence of up to five years and a $220,000 fine after he pleaded guilty to insider trading.
The sentencing leniency of white-collar crimes, including tax fraud, financial misstatement and insider trading, has been raised by retired Federal Court judge Ray Finkelstein.
Last year Justice Finkelstein told The Age that the law adopted a soft approach against white-collar crime, imposing short or suspended sentences, and used prison as a last resort.
Newcastle University law head Sandeep Gopalan said there had been a dramatic increase in the prosecution of insider trading by the Australian Security and Investment Commission in the last four years.
Professor Sandeep said he disagreed with tougher criminal sanctions.
"There has been a push to criminalise these behaviours ... (and) to some extent it appeases the popular mood for vengeance against these high profile, high status individuals," Professor Gopalan said.
"I'm not saying we shouldn't have a hard stance, but you have to ask whether jail is the appropriate sanction."
Professor Gopalan said higher financial penalties or "clawing back the ill-gotten earnings" would achieve better penalty outcomes.
He said the punishment aims of deterrence, retribution and crime prevention were secured by an offender being banned from further practice in their professional fields, and financial penalty.
ASIC took on the responsibility of insider trading prosecution in 2009, and has had 19 successful prosecutions, from a possible 28.
Professor Sandeep said many people in these scenarios pleaded guilty.
Gay will be sentenced on August 14.
Changes to the law since he committed his crime has seen an increase of penalty to a maximum of 10 years' jail or a $765,000 fine, or three times the money derived from the offence.