ASIC suspends retail OTC derivative licence 

ASIC_regulator

ASIC, the financial regulator of Australia, has issued a press release to inform that it has suspended the Australian financial services (AFS) Licence of retail OTC derivative provider Australian Capital Markets Advisory Services Pty Ltd (ACMAS), after change of control.

ACMAS ceased providing financial services after a change of all directors and shareholdings in the company in June 2015 when the entity became a wholly owned subsidiary of Formax International Market Limited.

The new management of the company was unable to demonstrate it was fully compliant with many of the AFS licensing requirements.

ACMAS has stated it intends to set up and recommence its business in a few months. On this basis, ASIC has suspended its licence until 30 October 2015. If ACMAS is unable to demonstrate prior to that date that it is in a position to recommence its financial services business, including demonstrating its ability to meet the obligations that would apply to it as the holder of an AFS licence, consideration will be given to cancelling the licence entirely.

ASIC Commissioner Cathie Armour said, ‘We have seen an increase in retail OTC derivative providers purchasing companies that already hold a licence but that have ceased providing financial services. The new management are often not in a position to recommence providing services that are compliant with Australian obligations for an extended period of time.

‘More generally we would have concerns if new entrants to this market were trying to inappropriately bypass ASIC’s stringent AFS Licence application processes. Regulatory obligations on AFS licensees continue to apply after the change of control. Any entity that is unable to comply with Australian licensing obligations risks having its licence suspended or cancelled.’

Source: ASIC – ASIC suspends retail OTC derivative licence after change of control

 

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