ASIC blocks FXPRIMUS IPO


2 November AtoZForex, Lagos — ASIC has again proven its strict standards. The Australian regulator is reported to be an obstacle blocking the potential float of the FXPRIMUS IPO. The regulator has been concerned about the rise of forex brokers in the country and has been very reluctant to allow more. Sources say no new license has been issued by ASIC to forex brokers for about two years, having blocked many applications without rendering any explanation as to why.

FXPRIMUS is licensed by the financial Services Commission (FSC) and currently holds a Category 1 Global Business License granted by the FSC, and is also registered with the Financial Service Providers Register (FSPR) of New Zealand. Aside these licenses, the broker obtained over recently a license from the CySEC, in a bid to penetrate the Cypriot market in furtherance.

ASIC concerns

According to a report on Financial Review, FXPRIMUS has submitted a 135-page initial public offering prospectus to the Australian Securities and Investment Commission (ASIC), since April 16 to raise equity. The Australian regulator has refused to allow the float to commence. According to the report, an ASIC spokesperson commented thus in response to questions about the status of the raising:

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ASIC had a number of concerns and an interim stop order was placed on the FXPRIMUS Group Limited's prospectus on April 30, 2015. ASIC also notes the extensive regulatory and enforcement work conducted in the FX space and our concerns in relation to companies listing in Australia and conducting business in emerging markets."

Worries on Leverage levels

Back in March, Greg Medcraft ASIC chairman voiced his concern in a parliamentary hearing, saying that Australia was being "picked off" by online foreign exchange brokers that obtain licences and allow clients to bet on currency moves with up to 500 times leverage. He further stated that: "We're doing what we can in terms of vetting those who apply for licences in this area, particularly those that don't have a connection with Australia that are operating outside of Australia." 

Noteworthy is that FXPRIMUS has a shinny partnership deal with Manchester City, the reigning premier league champions, on a three and a half year global partnership deal worth $2 million per annum. Evidently, the leading online forex trading firm became Manchester City’s official online forex trading partner.

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