Federal Court of Australia Australian Prudential Regulation Authority v Gray [2024] FCA 79 File number: NSD 1097 of 2023 Judgment of: SHARIFF J Date of judgment: 13 February 2024 Catchwords: BANKING AND FINANCIAL INSTITUTIONS – application by Australian Prudential Regulation Authority (APRA) to permanently restrain respondent from conducting 'banking business' within the meaning of the Banking Act 1959 (Cth) (Banking Act) – application to permanently restrain respondent from assuming or using restricted words – where respondent associated with various non-legal 'banking' entities – where entities controlled by respondent carrying on 'banking business' without authorisation under the Banking Act – permanent injunctions granted Legislation: Constitution ss 51(xiii), 51(xx) Australian Prudential Regulation Authority Act 1998 (Cth) Banking Act 1959 (Cth) ss 5, 5(1), 7, 7(1), 8, 8(1), 9(3), 65A, 65A(2), 65A(3), 65A(6)(a), 65A(11), 65A(12), 66, 66(1), 66(1AC), 66(4)(a), 66(4)(c), 66A(1) Federal Court of Australia Act 1976 (Cth) ss 11, 23 Reserve Bank Act 1959 (Cth) s 44 Federal Court Rules 2011 (Cth) rr 8.05, 8.06, 10.01, 10.24, 41.06 Cases cited: Australian Prudential Regulation Authority v Garrett [2023] FCA 956 Australian Prudential Regulation Authority v Siminton (No 6) [2007] FCA 1608 Division: General Division Registry: New South Wales National Practice Area: Commercial and Corporations Sub-area: Commercial Contracts, Banking, Finance and Insurance Number of paragraphs: 64 Date of hearing: 13 February 2024 Counsel for the Applicant: Ms S Foda Solicitor for the Applicant: Dentons Counsel for the Respondent: The respondent did not appear ORDERS NSD 1097 of 2023 BETWEEN: AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY Applicant AND: ROBERT BRUCE GRAY Respondent order made by: SHARIFF J DATE OF ORDER: 13 February 2024 Penal Notice TO: ROBERT BRUCE GRAY IF YOU: A. REFUSE OR NEGLECT TO DO ANY ACT WITHIN THE TIME SPECIFIED IN THIS ORDER FOR THE DOING OF THE ACT; OR B. DISOBEY THE ORDER BY DOING AN ACT WHICH THE ORDER REQUIRES YOU TO ABSTAIN FROM DOING, YOU WILL BE LIABLE TO IMPRISONMENT, SEQUESTRATION OF PROPERTY OR OTHER PUNISHMENT. ANY OTHER PERSON WHO KNOWS OF THIS ORDER AND DOES ANYTHING WHICH HELPS OR PERMITS YOU TO BREACH THE TERMS OF THIS ORDER MAY BE SIMILARLY PUNISHED. THE COURT ORDERS THAT: 1. For the purposes of these orders, 'purported bank' means 'Commercial Development Bank', 'Creditnet Bank Internationale', any derivations thereof, or any other body, whether incorporated or not, described as a 'bank' which body: (a) Does not have the consent of the applicant under s 66 of the Banking Act 1959 (Cth) (Banking Act); or (b) Is not in possession of an authority under s 9 of the Banking Act to carry on banking business; or (c) Is not otherwise the subject of an order by the applicant pursuant to s 11 of the Banking Act that determines that subsection 66(1) of the Banking Act does not apply. 2. The respondent be permanently restrained and prohibited under s 65A of the Banking Act, whether by himself, his servants or agents or otherwise, from orally or in any written or electronic form: (a) Carrying on any banking business (as defined in s 5 of the Banking Act) in Australia in contravention of s 7 of the Banking Act; (b) Assuming or using the words 'bank', 'banker', 'banking' or any words or phrases of like import (whether or not in English) in relation to any purported bank, business or purported business in contravention of s 66 of the Banking Act; (c) Advertising, representing or stating that any purported bank, business or purported business will carry on banking business; 3. The respondent be permanently restrained and prohibited under s 23 of the Federal Court of Australia Act 1976 (Cth), whether by himself, his servants or agents or otherwise, from carrying on any activities incidental to carrying on a banking business, including but not limited to issuing any bill or note for the payment of money payable to bearer on demand and intended for circulation, or which purports to be a bill or note for the payment of money payable to bearer on demand and intended for circulation, in contravention of s 44 of the Reserve Bank Act 1959 (Cth); 4. Orders 2 and 3 above carry an endorsement in accordance with r 41.06 of the Federal Court Rules 2011 (Cth); and 5. The respondent pay the applicant's costs of the proceedings. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. REASONS FOR JUDGMENT SHARIFF J: INTRODUCTION 1 This is an application brought by the Australian Prudential Regulation Authority (APRA) concerning a claim that the respondent, Mr Robert Bruce Gray (Mr Gray), is unlawfully conducting a "banking business" in contravention of the Banking Act 1959 (Cth) (Banking Act). 2 By way of an originating application filed on 29 September 2023, APRA seeks orders to the following effect: (1) That Mr Gray be permanently restrained and prohibited under s 65A of the Banking Act from: (a) Carrying on any banking business (as defined in s 5 of the Banking Act) in Australia in contravention of s 7 of the Banking Act; (b) Assuming or using the words 'bank', 'banker', 'banking' or similar in relation to any purported bank, business or purported business in contravention of s 66 of the Banking Act; (c) Advertising, representing or stating that any purported bank, business or purported business will carry on banking business; (2) That Mr Gray be permanently restrained and prohibited under s 23 of the Federal Court of Australia Act 1976 (Cth) (FCA Act) from carrying on any activities incidental to carrying on a banking business, including but not limited to issuing any bill or note for the payment of money in contravention of s 44 of the Reserve Bank Act 1959 (Cth); (3) That Orders 1 and 2 above carry an endorsement in accordance with r 41.06 of the Federal Court Rules 2011 (Cth) (FC Rules); and (4) That Mr Gray pay the applicant's costs of the proceedings. 3 Mr Gray did not appear at the hearing of the matter on 13 February 2024. Ms Foda of Counsel appeared for APRA at the hearing and principally relied on an affidavit of Mr Christopher Alexander Sheehan affirmed on 27 September 2023 in support of its application (Sheehan Affidavit). Mr Sheehan holds the position of Manager within APRA's Enforcement Team. 4 I will make the orders sought by APRA. These are my reasons for doing so. BACKGROUND The role of APRA 5 APRA is an independent statutory authority that supervises institutions across the banking, insurance and superannuation industries. APRA is tasked with promoting the stability of the financial system in Australia and is constituted under the Australian Prudential Regulation Authority Act 1998 (Cth). 6 APRA is responsible for establishing and enforcing prudential standards and practices designed to ensure that, under all reasonable circumstances, financial promises made by banks and other entities it supervises are met within a stable, efficient and competitive financial system. 7 Authorised deposit-taking institutions (ADIs) are entities that have been granted authority by APRA under the Banking Act to carry on a banking business in Australia. They are regulated by APRA in accordance with the Banking Act and are listed in APRA's register of ADIs (ADI Register). 8 Given the importance that ADIs play in the provision of financial services to the community, as well as their role in the broader economy, ADIs are subject to strict standards, including being subject to, among other things, a prudential framework intended to manage the risks of banking activities, and ongoing supervision by APRA. Relevant entities 9 Commercial Development Bank (CDB) and Creditnet Bank Internationale (Creditnet) are business names associated with Mr Gray. Mr Gray purports to be the Bank Governor and Chairman of the Board of Governors of CDB, and Bank Governor, Chairman of the Board of Governors and Managing Trustee of Creditnet. Searches undertaken by APRA show that Mr Gray has been associated with Creditnet since at least 2004 and CDB since at least 2006. 10 As at the present time, the CDB website (located at www.cdbankcorp.com) (CDB website) provides that the registered domicile of CDB is Australia and lists contact details for an Australian mailing address in Broadbeach, Queensland. The CDB website is operational and contains the following statements: • Commercial Development Bank's mission is to provide its Clients with a competitive banking environment which encourages growth and fosters prosperity in a secure partnership that enables the aims and objectives of both the Bank and the Client to be achieved; • Commercial Development Bank provides Private and Retail banking services for discerning individuals. We provide a comprehensive range of specialist services tailored to your individual wealth goals; • We are pleased to announce the successful accreditation of Commercial Development Bank to the United Nations ("UN"), with Commercial Development Bank becoming an accredited United Nations Global Marketplace Organization that has been registered with 25 major United Nations Organizations and Divisions. Commercial Development Bank has been assigned the registration number: UNGM 531297; • [CDB is an] International Business Corporation [IBC] acting as Trustee on behalf of an International Business Trust Organization. 11 The Creditnet website (located at www.creditnetbank.com) (Creditnet website) provides that the registered domicile of Creditnet is Australia and lists contact details for an Australian mailing address in Broadbeach, Queensland. The Creditnet website is operational and contains the following statements: • Creditnet Bank Internationale (Creditnet) is a Sovereign Pure Trust operating as a Sovereign Status Banking Organisation with relational offices within various jurisdictions around the globe; • Creditnet has negotiated significant international transactions in various industries at both Corporate and Government levels. Our involvement has included agricultural, banking, building and development, mining, retail sales and marketing and various other industry groups; • Creditnet Bank Internationale can issue an array of Financial Instruments to suit your requirements; • Although initially established in 1999, since 24th September, 2004 Creditnet Bank Internationale has been domiciled in Australia and thereto reinforcing its common law right to contract as a Sovereign Status Banking Organisation to additionally and lawfully chose to operate under the Federal Legislation of the Bills-Of-Exchange Act 1909 (Australia) and banking operations referred to in the amendments of the Corporations Act Australia and other Federal and Constitutional Legislations. Creditnet being a Sovereign Status Banking Organisation is NOT registered under the statutory law of the Banking Act of 1959 which is subject to a private unregistered company called 'APRA' which monitors retail banks in Australia. 12 Mr Sheehan has caused his team to conduct a number of Australian Securities and Investment Commission (ASIC) company searches and "ABN look up" searches of both CDB and Creditnet which, as at 3 October 2023, returned no results. 13 Based on the ADI Register as at the same date, neither entity is a regulated entity as they are not authorised by APRA to carry on a banking business under the Banking Act. Nor has APRA given consent to Mr Gray, CDB or Creditnet to assume or use the words 'bank', 'banker' or 'banking', or any words or phrases of like import (whether or not in English). Nor has APRA made a determination under s 11 of the Banking Act that s 66(1) does not apply to Mr Gray, CDB or Creditnet. History of interactions between APRA and Mr Gray 14 On 25 August 2022, APRA received an email referral from the Head of Compliance at Deutsche Bank Australia and New Zealand in relation to an enquiry as to the "authenticity" of CDB. Soon thereafter, the matter was referred to APRA's then investigations team, under the management of Mr Sheehan. Mr Sheehan caused searches of APRA's systems to be conducted by his team, which revealed a long history of interactions between APRA and Mr Gray, CDB and Creditnet. Without being exhaustive, those interactions can be summarised as follows. 15 In September 2004, APRA first became aware of Creditnet when the Reserve Bank of Australia (RBA) made enquiries with APRA about Creditnet passing off bills of exchange to the Australian Tax Office for a commercial settlement. On 14 October 2004, APRA sent a cease and desist letter to the respondent regarding a breach of s 66 of the Banking Act. 16 On or about 22 October 2004, APRA received a response from Mr Gray on behalf of Creditnet which stated, among other things: Creditnet … is registered as a Sovereign Trust domiciled in Las Vegas, Nevada and established by authorities of the US constitution and the British Common Law. It is not subject to the statutory regulations imposed by statutory companies, trusts, partnerships or entities and has no offering of financial services in Australia. 17 On 28 October 2004, APRA sent two further cease and desist letters to Mr Gray regarding breaches of ss 66 and 67 of the Banking Act, addressed both to Creditnet's Queensland address and to its Law Vegas address. 18 On 9 November 2004, a member of the APRA enforcement team telephoned Creditnet and spoke with Mr Gray. The same day, APRA received a letter by fax from Mr Gray on behalf of Creditnet in response to APRA's letters of 28 October 2004 stating, among other things, that "Creditnet … operates from a Sovereign Jurisdiction, which is NOT under the control or jurisdictional authority of APRA." 19 Following the exchange of several more cease and desist letters and responses from Mr Gray in November 2004, the correspondence between the parties appears to have entered into a period of abeyance until November 2008, when APRA received a letter from the Commission de Surveillance du Secteur Financier in Luxembourg requesting information about Creditnet. On 20 November 2008, APRA informed the Commission de Surveillance that no organisation by the name of Creditnet was, or had been, authorised as a bank by APRA. 20 On 3 August 2009, APRA sent three further cease and desist letters to Creditnet at each of its mailing addresses at that time (one in Queensland, one in Switzerland and one in Hong Kong), regarding breaches by Creditnet of s 66 of the Banking Act. On 31 August 2009, the Mr Gray on behalf of Creditnet responded to APRA's 3 August 2009 letters stating that Creditnet "will respectfully remain as Status Quo." 21 On 10 June 2011, Mr Gray on behalf of Creditnet sent a letter to APRA stating that: Creditnet is lawfully established as a Sovereign Status Trust Organisation; which is domiciled in Australia and operates as a bank in Australia under the Federal Legislation of 1909… We do NOT operate under the statutory banking act of 1959 which is monopolised under the watchdog of a privately controlled company called APRA. 22 On 19 July 2011, APRA received an email from the RBA in relation to an email the RBA had received from Ms Liliana Botsorovski, Head of Foreign Relations, JSCB Moldindconbank SA in Moldova asking whether Creditnet had been properly authorised by the RBA. APRA replied to Ms Botsorovski the same day stating that no organisation by the name of Creditnet was, or had been, authorised as a bank by APRA. 23 Between 10 August 2011 and 25 April 2023, APRA received various communications from members of the public regarding CDB and Creditnet. In short, these communications involved members of the public requesting APRA to confirm whether CDB and Creditnet were licensed and authorised by APRA. A number of these communications also included examples of CDB offering to issue international bills of exchange to entities overseas. 24 Between February and May 2012, APRA and Mr Gray exchanged further cease and desist letters and responses in relation to purported breaches by CDB of s 66 of the Banking Act. 25 In a letter dated 7 May 2012, Mr Gray maintained that CDB was "a Sovereign Status Organisation established under the British Common Law and is not under the jurisdiction of APRA." 26 APRA records from 2012 state that the Australian Taxation Office (ATO) took over primary responsibility for investigating CDB at that time. APRA continued to provide the ATO with updates on actions it took in relation to CDB, including engaging with the domain hosts of the CDB and Creditnet websites requesting their removal, and the matter was moved to a monitoring status. 27 Between 13 April 2022 and 18 January 2023, APRA engaged with various peer domestic regulators and referred the conduct of CDB, Creditnet and Mr Gray to law enforcement agencies. 28 As outlined above at [14], on 25 August 2022, APRA received a referral from Deutsche Bank Australia and New Zealand in relation to an enquiry as to CDB's "authenticity", prompting Mr Sheehan to recommence investigations into Mr Gray and to undertake the searches referred to above at [12]-[13]. 29 On 21 November 2022, APRA sent another cease and desist letter to CDB regarding breaches of s 66 of the Banking Act. On 6 December 2022, Mr Gray on behalf of CDB responded stating: As a Sovereign Status Organisation, established under the laws of the realm of Sovereignty, we do NOT operate under the jurisdiction of, nor do we owe our existence to, nor are we dependent upon, and nor do we accept powers, benefits or privileges from, any statues of: APRA – a "(non-registered) private company – holder of Australian Company Number (ACN) 021628175. … Any actions to challenge the legitimacy of Commercial Development Bank as a Sovereign Status Entity should be made before the International Court of Justice in Den Haag (peace Palace, The Hague, Netherlands). 30 On 22 December 2022, APRA sent a further cease and desist letter to CDB. On 9 January 2023, Mr Gray on behalf of CDB responded to APRA stating that CDB "will respectfully remain as Status Quo." 31 On 25 April 2023, APRA received a letter from Brinkmann & Partner in Frankfurt, Germany, requesting information on whether CDB is a registered financial institution with a banking licence in Australia. On 5 May 2023, APRA responded to the Brinkmann & Partner letter stating that "CDB is not on the ADI Register and does not have an authority to carry on banking business in Australia." 32 On 3 July 2023, APRA sent a further cease and desist letter to Creditnet regarding breaches of s 66 of the Banking Act. On 7 August 2023, Creditnet responded to APRA stating: Although we are not under the jurisdiction of APRA nor legally required to comply to your requests; out of pure courtesy please see our attached response to your letter that declares again our position more definitively for your understanding and our remaining as the Status Quo. 33 On 5 September 2023, APRA sent letters to CDB and Creditnet reiterating its demand for each entity to cease and desist from using the word 'bank' in Australia in relation to financial business and attaching the judgment of Lee J in Australian Prudential Regulation Authority v Garrett [2023] FCA 956, a case in which APRA successfully applied to permanently restrain a non-ADI respondent from conducting banking business in Australia. On 13 September 2023, CDB and Creditnet each responded to APRA stating that they "are NOT operating under the Banking Act of 1959, NOR are our operations under the jurisdiction of APRA or ASIC." 34 As noted above at [2], APRA instituted these proceedings by way of an originating application filed on 29 September 2023, seeking orders permanently restraining Mr Gray from carrying on any banking business in Australia and from using the words 'bank', 'banker' or 'banking' in relation to any purported bank or business. Preliminary issue as to service 35 In light of Mr Gray's absence from these proceedings, before turning to the substantive application, I will briefly address a preliminary issue which arose in relation to service of the originating documents on Mr Gray. In this regard, I rely on an affidavit of Mr Ben Allen, the solicitor representing APRA in these proceedings, affirmed on 14 November 2023 (Allen Affidavit). 36 Rule 8.06 of the FC Rules requires that an applicant personally serve an originating application (and each other document required to accompany the application by r 8.05 or any other rule of the Court) on each respondent as soon as practicable and at least five days before the return date of the application. Rule 10.01 provides that a document that is to be served personally on an individual must be served by leaving the document with the individual. 37 On 29 September 2023, Mr Allen caused a process server to be engaged on behalf of APRA to effect personal service of the originating documents on Mr Gray at the Queensland address listed on Credinet's website (first address). That address was in fact a rented mailbox, and the attempted service was unsuccessful. 38 On 4 October 2023, Mr Allen caused the process server to be provided with a second Queensland address associated with Mr Gray to attempt personal service (second address). At that address, the process server spoke with an older female occupant and young male occupant who advised that Mr Gray was not at the address, but that the young male occupant could get a message to Mr Gray or pass the documents on to him. 39 On both 11 and 13 October 2023, the process server again attempted, unsuccessfully, to effect personal service on Mr Gray at the second address. On 13 October 2023, the process server spoke with an older male occupant who informed the process server that he was the owner of the property, that Mr Gray had never resided at the address, that Mr Gray currently resides overseas, that Mr Gray's daughter is his partner and they have a child together, that the older female occupant and young male occupant encountered on 4 October 2023 were Mr Gray's wife and son, and that Mr Gray's son checks the rented mailbox at the first address on Mr Gray's behalf most days. 40 On 16 October 2023, Mr Allen caused an email to be sent to Mr Gray attaching the originating documents via the following email addresses: (i) admin@cdbankcorp.com; (ii) robertgray888@gmail.com; and (iii) admin@creditnetbank.com. Mr Allen was informed by Mr Sheehan that Mr Gray had used the above email addresses when communicating with APRA as recently as September 2023. Mr Gray did not reply to any of the emails sent on 16 October 2023, and despite the efforts outlined above, APRA was unable to personally serve the originating documents on Mr Gray. 41 In light of this, APRA filed an interlocutory application on 14 November 2023 seeking leave pursuant to r 10.24 of the FC Rules to serve the originating documents on Mr Gray via mail to the various addresses associated with Mr Gray, by leaving a copy of the documents at those addresses, and by sending a copy of the documents to the email addresses set out above. I was satisfied that it was appropriate to grant that application and made orders to that effect at a case management hearing on 24 November 2024. 42 I now turn to the substantive application. APPLICABLE PRINCIPLES Authority to carry on banking business 43 The operation of the relevant legislative scheme was set out comprehensively in Australian Prudential Regulation Authority v Siminton (No 6) [2007] FCA 1608 at [3]-[6] per Tracey J, and in Garrett at [46]-[53] per Lee J, and does not require detailed elaboration. 44 Subsection 5(1) of the Banking Act defines a "banking business" as a business that consists of banking within the meaning of paragraph 51(xiii) of the Constitution, or a business that is carried on by a corporation to which paragraph 51(xx) of the Constitution applies and that consists, to any extent, of: (i) both taking money on deposit (otherwise than as part-payment for identified goods or services) and making advances of money; or (ii) other financial activities prescribed by the regulations. 45 As noted above at [7], APRA is empowered under subsection 9(3) of the Banking Act to grant bodies corporate the authority to carry on a banking business in Australia. A body so authorised is known as an ADI. 46 Subsection 7(1) of the Banking Act makes it an indictable offence for a person who is not a body corporate to carry on a banking business in Australia. Similarly, subsection 8(1) makes it an indictable offence for a body corporate which is not the RBA or an ADI to carry on a banking business in Australia. Under s 11, APRA may make a determination that subsections 7(1) and 8(1) do not apply to a particular person or body corporate, in which case that person or body corporate will not commit an offence by carrying on a banking business in Australia. Restriction on the use of certain words 47 Subsection 66(4)(c) of the Banking Act defines a financial business as a business that consists of, includes, or relates (in whole or in part) to the provision of financial services. 48 Under subsection 66(1), a person commits an offence if the person carries on a financial business (whether or not in Australia) and the person assumes or uses in Australia a restricted word or expression in relation to that financial business in the absence of the statute permitting the use, consent from APRA or a determination under s 11 that the subsection does not apply to the person. The restricted words or expressions are defined in subsection 66(4)(a) as including 'bank', 'banker' or 'banking', and any other word or expression (whether or not in English) that is of like import to those words. Per subsection 66(1AC), it is not an offence for an ADI to assume these words in relation to the ADI's financial business. 49 Subsection 66A(1) of the Banking Act contains similar offence provisions in relation to a person, other than an ADI, carrying on a financial business (whether or not in Australia) and using the expression 'authorised deposit-taking institution' or 'ADI' in the absence of a determination under s 11 that the subsection does not apply to the person. APRA's standing and relief which may be granted 50 Section 65A of the Banking Act confers power on this Court to grant certain forms of injunctive relief where a person has engaged, is engaging or is proposing to engage in conduct that constitutes, constituted or would constitute a contravention of ss 7, 8 and 66. 51 Subsection 65A(6)(a) confers standing on APRA to apply to the Court for an injunction. Certain specific provisions deal with the nature and extent of the Court's power to grant injunctions and other relief under s 65A. Subsections (2), (3) and (11) of s 65A provide: (2) The injunction: (a) may restrain the person from engaging in the conduct; and (b) may also require that person to do a particular act or thing, if the Court thinks it desirable to do so. The Court may grant an injunction on such terms as it thinks appropriate. (3) The power of the Court to grant an injunction restraining a person from engaging in conduct may be exercised: (a) whether or not it appears to the Court that the person intends to engage again, or to continue to engage, in conduct of that kind; and (b) whether or not the person has previously engaged in conduct of that kind; and (c) whether or not there is an imminent danger or substantial damage to any other person if the person engages in conduct of that kind. … (11) If the Court has power under this section to grant an injunction restraining a person from engaging in particular conduct, or requiring a person to do a particular act or thing, the Court may, either in addition to or in substitution for the grant of the injunction, order that person to pay damages to any other person. 52 Subsection 65A(12) provides that these powers are conferred in addition to and do not derogate from any of the Court's other powers including, relevantly, the general power conferred by s 23 of the FCA Act. CONSIDERATION 53 This Court has jurisdiction to hear and determine the present application: Garrett at [64]. The Court's jurisdiction is attracted by a matter arising under a law made by the Parliament, being the Banking Act: Garrett at [64]. As Lee J reasoned in Garrett, the power to make the orders sought is to be exercised judicially but is not rendered subject to the same principles which apply to the grant of equitable injunctions: see also Siminton at [62]. Among the considerations which the Court must take into account are whether the injunction would have utility or would serve some purpose within the contemplation of the Banking Act: Siminton at [64]. 54 I am satisfied that the orders sought by APRA should be made, and that I have the jurisdiction both under the Banking Act and the FCA Act to make those orders. 55 I am satisfied that neither CDB nor Creditnet are APRA regulated entities. They are neither authorised nor licensed to carry on a banking business pursuant to subsection 9(3) of the Banking Act. Nor has APRA made any determinations pursuant to s 11 of the Banking Act that the prohibitions in ss 7, 8 and s 66(1) of that Act do not apply to these entities. 56 The evidence establishes that CDB and Creditnet have been carrying on a banking business (which purports to be an authorised banking business), including by issuing, or seeking to issue, financial instruments. The evidence establishes that, for instance, CDB and Creditnet have issued or sought to issue international bills of exchange and bank guarantees. There are also instances of foreign financial institutions and businesspeople advising APRA or the RBA of attempts by CDB and Creditnet to engage in banking business with them or their clients. 57 Accordingly, I am satisfied that CDB and Creditnet are acting in contravention of ss 7 and 8 of the Banking Act. 58 The evidence also establishes that CDB and Creditnet have used the words 'bank', 'banker' or 'banking', or variants of those terms, in their advertising and promotional material on their website and elsewhere. I refer to the materials extracted above at [10]-[11]. APRA has not consented to CDB or Creditnet assuming or using these terms. 59 Accordingly, I am satisfied that CDB and Creditnet are acting in contravention of s 66(1) of the Banking Act. That is because I am satisfied that CDB and Creditnet are carrying on a financial business in Australia and elsewhere and in doing so have assumed and used restricted words without APRA's consent and without a relevant determination in force under s 11 that this prohibition does not apply. 60 On all of the evidence adduced before me, I am also satisfied that Mr Gray is the person who relevantly operates CDB and Creditnet. Mr Gray is the person who has communicated with APRA in relation to various matters over a period of approximately 20 years. I am satisfied that he is a person who has made relevant decisions and engaged in various acts and omissions in respect of CDB and Creditnet carrying on as banks or as apparent banking businesses. The orders made by the Court should be directed to Mr Gray, noting also that on the materials before me, CDB and Creditnet are not incorporated bodies in Australia. 61 I am satisfied that these orders have utility and should be made. CDB, Creditnet and Mr Gray have continued to carry on banking and financial services despite being informed not to do so. They have continued to use restricted words despite being asked to cease and desist. Mr Gray has indicated through his communications with APRA that he intends to maintain the existing "status quo" and there is evidence before me that CDB and Creditnet continue to be promoted via their respective websites. It follows that there remains a risk that members of the public are being misled. The orders also serve as a deterrent to others and uphold the regulatory role of APRA as enacted under the Banking Act to seek to restrain such conduct from occurring in the present and dissuading others from doing the same. 62 Orders should be made permanently restraining CDB, Creditnet and Mr Gray from doing the things sought in APRA's application to this Court including orders restraining them from using words associating them with the provision of banking services (including variants of those terms) as set out in s 66 of the Banking Act. Orders should also made permanently restraining them from advertising, representing or stating that they are providing or will provide banking services. 63 I am also satisfied that the orders I make should carry an endorsement in accordance with r 41.06 of the FC Rules. DISPOSITION 64 I will make the appropriate orders and direct that they be served on Mr Gray with the following endorsement: Penal Notice TO: ROBERT BRUCE GRAY IF YOU: (A) REFUSE OR NEGLECT TO DO ANY ACT WITHIN THE TIME SPECIFIED IN THIS ORDER FOR THE DOING OF THE ACT; OR (B) DISOBEY THE ORDER BY DOING AN ACT WHICH THE ORDER REQUIRES YOU TO ABSTAIN FROM DOING, YOU WILL BE LIABLE TO IMPRISONMENT, SEQUESTRATION OF PROPERTY OR OTHER PUNISHMENT. ANY OTHER PERSON WHO KNOWS OF THIS ORDER AND DOES ANYTHING WHICH HELPS OR PERMITS YOU TO BREACH THE TERMS OF THIS ORDER MAY BE SIMILARLY PUNISHED. I certify that the preceding sixty-four (64) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Shariff. Associate: Dated: 13 February 2024