AFCA Warns Berndale Clients Recovery of Funds is Unlikely

The Australian Financial Complaints Authority (AFCA) has delivered an update to its information page regarding Berndale Capital Securities Pty Ltd, an over-the-counter (OTC) derivative issuer who had its license canceled by the Australian Securities and Investment Commission (ASIC ASIC The Australian Securities and Investments Commission (ASIC) is the prime regulator in Australia for corporate, markets, financial services, and consumer credit. It is empowered under the financial service laws to facilitate, regulate, and enforce Australian financial laws. The Australian Commission was set up and is administered under the Australian Securities and Investment Commission Act of 2001. ASIC was initially the Australian Securities Commission based on the 1989 ASC Act. Initially, the The Australian Securities and Investments Commission (ASIC) is the prime regulator in Australia for corporate, markets, financial services, and consumer credit. It is empowered under the financial service laws to facilitate, regulate, and enforce Australian financial laws. The Australian Commission was set up and is administered under the Australian Securities and Investment Commission Act of 2001. ASIC was initially the Australian Securities Commission based on the 1989 ASC Act. Initially, the Read this Term).

In its statement, the complaints authority said: “At this stage, we understand it is unlikely that Berndale investors will have all their funds returned. It is too early to estimate the amount of funds that might be returned to each investor.”

As Finance Magnates reported, Melbourne-based Berndale had its Australian Financial Services (AFS) canceled in November of 2018. This is because the regulator found that the company had failed to meet the Obligations Obligations In finance, an obligation is a financial responsibility where the terms of a contract must be met. Should an obligation between parties fail then the party who is at default may face legal action. In this scenario, the guilty party will not only have to agree to pay the set amount to fulfill the contractual arrangement but may also be responsible for covering all legal proceedings cost. Routine payments or outstanding debt of any kind are considered financial obligations, so if someone owes you In finance, an obligation is a financial responsibility where the terms of a contract must be met. Should an obligation between parties fail then the party who is at default may face legal action. In this scenario, the guilty party will not only have to agree to pay the set amount to fulfill the contractual arrangement but may also be responsible for covering all legal proceedings cost. Routine payments or outstanding debt of any kind are considered financial obligations, so if someone owes you Read this Term of the financial license.

In particular, the Aussie watchdog found that the company didn’t ensure that its representative complied with financial services law and didn’t have enough financial and human resources, among other contraventions.

Berndale tried to appeal ASIC decision

Since the canceling of the license, Berndale has tried to appeal the decision with the Administrative Appeals Tribunal. However, towards the end of 2018, ASIC obtained freezing orders from the Federal Court to freeze all of the company’s bank accounts. Since then, liquidators have been appointed by the Federal Court.

“Berndale is a current member of AFCA. While ASIC required Berndale to maintain its AFCA membership until at least 23 May 2019, Berndale will continue to remain a member of AFCA until 30 October 2020,” AFCA said on its website.

“If you have not lodged your complaint against Berndale, you will need to do so by 30 October 2020. AFCA will not deal with complaints it receives against Berndale after that date.”

As Finance Magnates reported last year, Berndale has failed to pay complaint-related charges to AFCA. In particular, AGM Markets Pty Ltd, Direct FX Trading Pty Ltd, and Berndale Capital Securities Pty Ltd collectively owe AU$1.245 million to the complaints authority.