ASIC Cancels AFS Licence of OTC Derivatives Issuer Forex CT

The Australian Securities and Investments Commission (ASIC) announced this Friday that it has cancelled the Australian financial services (AFS) licence of Forex Forex Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Read this Term Capital Trading Pty Ltd, a retail over the counter (OTC) derivative issuer.

Before having its licence cancelled, Forex Capital Trading, also referred to as Forex CT, offered trading in contracts for difference (CFDs) and margin foreign Exchange Exchange An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv Read this Term (forex) contracts. Following its investigation, ASIC found that the company’s business model disregarded key obligations of an AFS licensee, resulting in unconscionable conduct, misleading and deceptive conduct and a failure to manage conflicts of interest.

“ASIC’s investigation also found that Forex CT lacked sound ethical values and judgement in dealing with clients, failed to ensure its representatives were adequately trained and complied with financial services laws and failed to ensure that financial services covered by its licence were provided efficiently, honestly and fairly,” ASIC said in its statement today.

ASIC: some Forex CT clients experienced large losses

During its investigation, ASIC found that a number of clients, who were trading CFD and FX contracts, had experienced large losses in the hundreds of thousands of dollars, including from their superannuation accounts.

As Finance Magnates reported, the regulator appeared before Federal Court in Melbourne last year to extend measures prohibiting the company from removing its assets from Australia as well as disposing of its property and freezing monies in its bank account.

Commenting on the cancellation, ASIC Commissioner Cathie Armour said in the statement: “ASIC continues to focus on conduct by AFS licensees who operate business models that harm consumers.”

Following the cancellation, Forex CT’s AFS licence will continue until the 31st of July 2020, so that there will be a dispute resolution scheme in place. This time period will also allow the company to close any existing client positions. During this time, the company can’t open any new client positions.