ASIC bans derivatives dealer
A Sydney-based derivatives dealer has been banned from providing financial services following an investigation into allegations of misleading conduct and conducting business without a licence.
Omar Diab, of Wollongong, was a director of Sydney-based companies Xenith Capital and Xenith Investment Corp Australia, and at the relevant time did not hold an Australian financial services licence (AFSL).
The Australian Securities and Investments Commission (ASIC) found that between March 2009 and November 2009, Diab’s clients opened contracts for difference (CFD) trading accounts with CMC Markets, granting Diab powers of attorney in relation to those accounts.
Diab was found to have given numerous daily instructions to CMC Markets to execute CFD trades for many of his clients.
ASIC found that the number of clients and the number of transactions executed constituted undertaking a financial services business without holding an AFSL.
ASIC also found Diab to have engaged in misleading and deceptive conduct by making false statements that conveyed misrepresentations to a client when he was a director of Xenith Capital.
The regulator stated it banned Diab “in order to protect the public, deter similar conduct and maintain consumer confidence in the financial services industry”.
ASIC also said CMC Markets was not suspected of any wrongdoing and cooperated with the investigation.
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