The Australian Federal Court issued its verdict in the ASIC vs TitanTrade case, the judge ruling in favor of the regulator. The Court has determined that Binary options broker TitanTrade violated the Corporations Act regarding the pressure sale of binary options to Australian consumers.
07 February, 2020 | AtoZ Markets – The Australian Securities & Investments Commission (ASIC) announced that it had won a significant victory in proceedings against Binary Options Broker TitanTrade. The Federal Court has determined that One Tech Media Limited (OTML) known as TitanTrade have violated the Corporations Act. It conducts the unlicensed sale of binary options to Australian consumers.
TitanTrade Breached the Corporations Act
OTML, based in Seychelles and then in the Marshall Islands, offered binary options trading to clients in Australia through:
But it did not hold an Australian financial services license ( AFSL). OTML also issued binary options without providing the necessary product information statements. Justice Davies said:
Australian company Allianz Metro Pty Ltd, Eustace Senese and Yoav Ida have also been found guilty of violating Corporations Act. They provided paying agency services to the financial services activities carried out by OTML, thereby enabling OTML to raise funds from Australian clients.
Due to their contributions, Allianz Metro Pty Ltd, Eustace Senese and Yoav Ida arranged for OTML to issue binary options. Thus it carried out themselves a financial services activity without holding the required licenses.
Justice Davies also determined that Mr. Senese and Mr. Ida did not issue the required product disclosure statement each time OTML issued a binary option. Danielle Press, ASIC commissioner, also said in the statement:
“This judgment provides much-needed clarification as to what constitutes an” arrangement “in the context of a person arranging the transaction of a financial product by another person “. The ASIC litigation has clarified grey areas of the law. It ultimately benefits both ASIC, the industry and, most importantly, consumers.”
ASIC will now seek:
- OTML pay civil sanctions in connection with the Court’s declaration
- Disqualification orders against Eustace Senese and Yoav Ida
Other Defendants Not Violating the Corporations Act
The Court will set the date of the hearing on the penalty. Allianz Metro Pty Ltd did not provide custody or deposit service. However, five other Australian defendants have not broken the Corporations Act. They are:
- Bianco Pty Ltd,
- IMC Holdings Pty Ltd,
- Sansen Pty Ltd,
- Transcomm Global Pty Ltd and
- Cameron Senese
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