"We found a set of practices which cannot be regarded as acceptable for a corporation of the size and significant of Telstra to the Australian market, but which fell short of being appropriate for court proceedings," said Australian Securities and Investments Commission (ASIC) chairman Jeffrey Lucy in a statement.
ASIC had started investigating Telstra following a leak to the media in mid-August by a senior executive of the telecommunications company of a confidential briefing paper intended for certain members of parliament and their staff.
Telstra released the full document to the Australian Stock Exchange (ASX) on 7 September after discussions with the regulator.
"The release of confidential information by a senior executive of Telstra, without providing the document to the whole market, is an unacceptable practice, particularly where only part of the document is released," Lucy said.
"It can create a risk of confusion and did, in this case, lead to uninformed and unhelpful speculation about Telstra's prospects."
ASIC also targeted the carrier over its decision not to include in material released to the ASX some information given in a briefing to analysts following the release of Telstra's results on 11 August.
"While the briefing was webcast, that is not a substitute for the clear requirement in the ASX listing rules to provide any price-sensitive information to the ASX in the first instance," ASIC said. The regulator also targeted an earnings downgrade announcement issued on 5 September "and the apparent linking of the AU$850 million cost of regulation to the downgrade".
"ASIC's investigation found that there was no such direct link and that the wording of the announcement had the potential to confuse ordinary readers," it said.
"I have written to the board of Telstra summarising ASIC's findings and outlining our concerns to serve as a warning to the board and senior management to lift their game on continuous disclosure," Lucy concluded.