ASIC suspends Direct FX’S AFS licence
The Australian Securities and Investments Commission (ASIC) has suspended the Australian financial services (AFS) licence of Direct FX Trading for a minimum of ten weeks and up to six months, depending on whether the company can demonstrate compliance with the conditions attached to its licence by October this year.
The AFS licence was suspended following an ASIC investigation that found Direct FX had failed to comply with its Net Tangible Asset (NTA) requirements, including not having sufficient cash and cash equivalents.
Direct FX also failed to comply with a section 912C (3) direction, issued in February this year, which required it to give ASIC an audit report that included information about the company’s compliance with its financial obligations. It also failed to replace key persons named on its licence.
ASIC commissioner Cathie Armour said Direct FX was in breach of important financial conditions of its licence, which is aimed at protecting investors from the higher operational and credit risks posed by the retail OTC derivative sector.
“When ASIC was trying to conduct its enquiries, the entity did not cooperate in a timely and efficient fashion that we would expect of licensees, and failed to comply with ASIC directions,” said Armour.
ASIC said the suspension would also affect the financial services provided by Direct FX’s authorised representative, Core Liquidity Markets.
AUTHOR
Anastasia Santoreneos
Recommended for you
Compared to four years ago when the divide between boutique and large licensees were largely equal, adviser movements have seen this trend shift in light of new licensees commencing.
As ongoing market uncertainty sees advisers look beyond traditional equity exposure, Fidante has found adviser interest in small caps and emerging markets for portfolio returns has almost doubled since April.
CoreData has shared the top areas of demand for cryptocurrency advice but finds investors are seeking advisers who actively invest in the asset themselves.
With regulators ‘raising the bar’ on retirement planning, Lonsec Research and Ratings has urged advisers to place greater focus on sequencing and longevity risk as they navigate clients through the shifting landscape.
