In its latest enforcement action, the Australian Securities & Investments Commission (ASIC) has suspended the license of Prospero Markets Pty Ltd (Prospero), an over-the-counter derivatives issuer offering forex and contracts for differences (CFDs) instruments, for failure to lodge financial statements and audit reports.
According to the official announcement today (Friday), the company’s Australian Financial Services (AFS) license has been suspended on 20 December 2023 and will be effective until 28 February 2024. The broker has provided an undertaking to the regulator that it will not deal with clients' funds without a regulatory agreement.
Failure to Lodge Financial Statements
The action came as the broker “failed to lodge its annual financial statement and audit report for the financial year ending 30 June 2023 within the prescribed timeframe and in compliance with its AFS license conditions.” It surfaced as the regulator investigated the broker on 16 November 2023 for suspected violations from 1 March 2021.
The regulator highlighted that if the broker fails to lodge the financial statements and reports within the suspension period, it will explore extending the suspension or even canceling the license.
“On 19 December 2023, Prospero agreed to ASIC’s request that Prospero provide an undertaking to ASIC that it will not deal in client funds without ASIC’s permission. The undertaking will remain until at least 8 February 2024 to allow ASIC time to investigate its concerns,” the regulator stated and highlighted: “Prospero is assisting ASIC with its investigation.”
However, whether Prosper Markets will appeal against the regulatory decision is unclear. Finance Magnates reached out to Prosper Markets but has not received a response as of press time.
A China-Focused Broker
As seen on its website, Prosper Markets' offerings include forex, precious metals, commodities, indices, and share CFDs. It established its Australian operations in 2012 and provides its services in the Chinese language, in addition to English, indicating that it has a significant proportion of Chinese-speaking clients, although none of the numbers are in the public domain.
Meanwhile, the ASIC took action against several other CFDs providers under its jurisdictions, mostly citing failures around design and distribution rules.
