IKON Agrees with ASIC to Separate Overseas Client Funds From its AFS license

After concerns were raised by the regulator, the Australian Securities and 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 Commission (ASIC) today announced that retail over-the-counter (OTC) trading firm Ikon Australia Pty Ltd (IKON) has agreed to rectify client trust accounts and improve disclosures, according to an official press release from ASIC.

IKON has agreed to separate out overseas client funds from the Client Money Client Money Client money refers to the money or margin – which may be any currency in the form of cash, check, draft, or electronic transfer – that a firm receives or holds for a client. Money held by a firm in the form of a stakeholder, which is are not payable on demand or immediately due, also refers to client money. The definition of client money does not apply to money held by businesses that operate in its own name on behalf of a client. Although the client does have to be in agreement before this arr Client money refers to the money or margin – which may be any currency in the form of cash, check, draft, or electronic transfer – that a firm receives or holds for a client. Money held by a firm in the form of a stakeholder, which is are not payable on demand or immediately due, also refers to client money. The definition of client money does not apply to money held by businesses that operate in its own name on behalf of a client. Although the client does have to be in agreement before this arr Read this Term that it holds in compliance with its obligations under Australia’s Corporations Act laws, since its overseas investors are not associated with the financial services provided under Ikon’s license as an Australian Financial Services (AFS) provider.

Site revision and disclosures

The company has also revised its website as a result of the measures from ASIC and the firm agreed to directly inform its overseas customers that the services provided to them, outside of Australia, are not covered by Australian regulations.

ASIC noted in the press release that because IKON's current business structure entailed its overseas clients providing services from offshore locations (i.e. outside of Australia), these services don’t fall under its AFS license.

Mostly offshore clients

The regulator said that Ikon confirmed how only 0.03% of its clients are Australian investors, and ASIC noted that the company is taking steps to obtain consent from each Australian client in order for the firm to transfer their funds into a separate segregated trust account, while also informing the majority of the firms clients which are offshore that their funds aren't afforded the same benefits under the companies AFS license.

The measures are apparently aimed to help improve transparency with the required disclosures while rectifying the trust accounts to prevent the two groups of domestic and offshore client funds from being co-mingled in the same account. Finance Magnates wrote about IKON Australia earlier this year after Jacob Nel took the helm as CEO of the company. According to information on LinkedIn, Mr. Nel is currently also listed as CEO of IKON Multibank Group.