iSignthis released Business Update
iSignthis announced its 6th consecutive positive quarterly operating cash flow contained in the Appendix 4C and its quarterly business activity report. The Company is profitable, with more than 110 staff between Australia, UK, Lithuania, Cyprus, Malta, Netherlands, and Israel.
- Cash Receipts: $8.850m UP↑ 4.9% from previous $8.433m last quarter
- Costs $7.433m UP↑ 3.4% from $7.188m last quarter
- Net Cash from activities (normalised after tax payments): $1.732m UP↑ 8.1% from $1.602m last
Details of the Appendix 4C are here.
The business’ growth continues to be self funded, with spending on R&D steady, whilst remaining cashflow positive and profitable.
The Company made payment of 18 months of back taxes against corporate profits last quarter. Payment of Tax instalments are now under active management, with instalments to be made at least twice annually, to avoid future lumpy payments.
The Company’s revenues have been building since 2017, and, excluding an back half of 2018 where external supply chain and technology issues temporarily hampered itsprogress, these have all been consistently derived from delivery of its services, including integrations, delivery of platforms, and regulated services.
ASX Market Release 27th October 2020
ASX Ltd’s release yesterday of selective extracts from outdated correspondence between an iSignthis Ltd’s EU subsidiary and Visa Europe Ltd is a disgraceful abuse of its privileged position as a licensed market operator. It is a blatant and undisguised effort to enhance its commercial position and attempt to sway opinion regarding the current Federal Court litigation brought by iSignthis.
“It would appear that ASX Ltd is trying to create a public controversy where one did not exist. There have been a number of serious governance failures of high profile ASX listed companies lately with the ASX Ltd having been silent on each of these. iSignthis clearly draws disproportional attention and criticism from the ASX Ltd, whose requirements of iSignthis continue to be inconsistent with those of every other listed entity on the exchange.
There is not a single auditor, independent expert, or regulator in any jurisdiction that has issued any serious or material adverse report or notice against iSignthis or its subsidiaries. The ASX Ltd alone stands out in its continuous and unjustified attacks on the Company, as it seeks to further its commercial interests by abuse of the listing rules and its position as a licensed market operator.”
What ASX Ltd failed entirely to mention is that “derogatory media” was a key aspect of the termination, as Visa is very conscious of reputation and “brand risk”. The term “brand risk” also refers to any service by a member like iSignthis that may be competitive or dis-intermediates the Visa brand at the point of sale.
The Company’s subsidiaries have been audited by all the major card schemes between November 2019 to March 2020, with no adverse reports issued.
Delving a little more in the Visa correspondence, the merchants raised by Visa as being “risky” (none of which fall into a high brand risk category) are still being processed by other Visa processors.
If Visa actually had any “AML” concerns, then it was legally obligated to report them to a regulator within a timely manner. It has not appeared to have done so (and the window is now closed), with no interaction between any financial intelligence unit in the EU and iSignthis on this matter. Not a peep.
AUSTRAC also has no concerns.
Nothing however beats where this all started with the AFR’s Jonathan Shapiro’s mythical (but more likely imaginary) “26 SAR’s” allegedly raised in mid 2018, which two years later have not amounted to a single thing. On a re-read of Shapiro’s article, allegedly 25 of these SAR’s were for transfers of amounts greater than €10k. Given the Company is a monetary financial intuition, this is not a very unusual position, and Shapiro lacks any insight whatsoever as to what a SAR is in any case.
As part of the defamation case Mr. N J (John) Karantzis have brought against the AFR’s gossip bloggist, Joe Aston, who massively overstated the significance of these SAR’s ( if they did ever exist), the Fairfax group admitted it does not have these SAR’s in their possession. It’s illegal to possess or release SAR’s as a third party, so the whole story has some credibility holes that we can all explore.
These are some of the facts that we have presented to Antitrust and Privacy regulators in the EU by our subsidiaries. Visa has already admitted to one Antitrust investigation in last quarters Form10-Q quarterly report.
Mr. N J (John) Karantzis can also confirm that the UK’s Financial Conduct Authority (which followed the Visa termination in authorising a UK AEMI), the Central Bank of Cyprus and the Central Bank of Lithuania all hold iSignthis in good standing (ie no fines, sanctions, notices, disciplinary or corrective actions), with 95% of our revenues originating in the EU, linked to monthly reporting to these regulators and central banks.
Mr. N J (John) Karantzis have been asked several times, and he can confirm that the Independent Expert (Clayton Utz) had access to all the correspondence ASX referred to in its release yesterday, plus additional correspondence, timelines, notes and interviews with management and the board when reviewing the Visa matter. The expert report was a $200k exercise at the cost of shareholders, which was comprehensive and conducting by independent, unbiased, experienced legal professionals.
The ASX Ltd’s attempt to diminish this is not only desperate, but undignified for “the Heart of Australia’s Financial Markets”.
The arrogance of the ASX Ltd to seek the Company’s legal advice is breathtaking. At no stage did iSignthis or its subsidiary waive legal privilege, and despite the ASX Ltd demanding that the Company do so, the Company will not do so. The Company is not being evasive – the Company is simply protecting its shareholders interests. The ASX Ltd conveniently overlooks that it is the defendant in a half billion dollar damages case. Mr. N J (John) Karantzis can think of no reason why the Company would ever deliberately cede an advantage to the defendant.
Of course, none of this has anything to do with why the Company was suspended in October 2019, and doesnt explain why it’s still suspended after meeting the 1st May 2020 directions (the four of them). What it does show is that no matter what the Company does, the ASX will simply confect another reason.
General Data Protection Regulation (GDPR) Breach
Australia, unlike New Zealand, does not have EU data protection adequacy status. What that means is that any transfer of data from EU to Australia has to be via a special procedure in accordance with the GDPR. Visa had no such procedures until it published its policy on the 21st August 2020, well after the iSignthis data breach.
Both the UK and Cyprus Information Commissioners are actively investigating Visa Europe’s actions, with the UK ICO having confirmed that Visa and the ASX are and have been in communications with each other.
The Cyprus Commissioner has determined that Visa has caused ‘harm to the freedoms and rights of EU Citizens” under the GDPR, so more on that to follow.
The Company is not liable as the data controller for any breaches by its data processors under the GDPR, especially where the breach was wilful and deliberate by Visa.
The Company has been working towards a listing by end of April 2021, to allow us to audit our full year 2020 and include results in a prospectus. This also allows the Company’s FY2020 to focus on the business, and start the listing process in January 2021, when the management team and directors are better able to focus.
The Company has been working towards a listing by end of April 2021, to allow the Company to audit its full year 2020 and include results in a prospectus. This also allows the Company’s FY2020 to focus on the business, and start the listing process in January 2021, when the management team and directors are better able to focus.