The Australian Securities and Investments Commission (ASIC) cancelled the Australian financial services (AFS) licence of Forex Capital Trading Pty Ltd (ForexCT).
05 June, 2020 | AtoZ Markets – ForexCT is a Forex and CFD trading services provider. Its AFS licence is 306400. It stated in its website, “ForexCT leads the pack when it comes to Forex and CFD trading in Australia. Whether you’re a skilled Forex trader or completely new to online trading, our trading platforms give you the tools needed to take advantage of the foreign exchange market’s volatility.”
Australian regulator ASIC announced the cancellation of ForexCT’s AFS licence. However, until 31 July 2020, the company is permitted to facilitate the orderly closure of existing customer positions. Moreover, the company cannot open new customer positions.
Why Did ASIC Cancel AFS Licence of Forex CT?
According to the ASIC, the company’s business model led to unethical behaviour, customer misleading behaviour and failure to manage conflicts of interest. Besides, it was unable to verify that its representatives were properly trained and comply with the Financial Services Act. ASIC Commissioner Cathie Armour said:
“CFDs and FX Contracts are OTC derivatives that allow clients to speculate on the change in the value of an underlying asset. ASIC’s investigation identified several clients incurring large losses in the hundreds of thousands of dollars, including from their superannuation accounts, from investing in these products.”
“ASIC continues to focus on conduct by AFS licencees who operate business models that harm consumers”, she added. Forex Capital Trading reserves the right to appeal to AAT for the review of this licence cancellation.
Yesterday, The Australian regulator also extended the suspension of BBY Ltd‘s AFS licence. The suspension was from 27 March 2020 to 30 June 2021. However, the regulator first suspended its AFS licence on 28 May 2015.
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