Commonwealth prosecutors are seeking to take their case against accused Whitehaven Coal share hoaxer Jonathon Moylan to the New South Wales Supreme Court.

Newcastle-based Moylan is charged with releasing a false statement from the ANZ Bank in January, claiming it had withdrawn funding for Whitehaven Coal's Maules Creek project on environmental grounds.

It caused a temporary crash in the share price of the mining company.

Prosecutors are now seeking to have Moylan tried in the Supreme Court, rather than the District Court.

Speaking outside the court, Moylan's lawyer John Sutton says his client is being hung out to dry.

"It's an enormous overreaction," he said.

"The...Government seemed to feel justified in charging as much as they possibly can, not only in terms of the gravity of the offence...but also in terms of the cost to the community in trying to make an example of Jonathan Moylan."

Prosecutors would not say why they wanted the case moved to a higher court.

Moylan was granted unconditional bail when he appeared in court in July.