Pershing Securities has become the first financial services company in Australia to be convicted of criminal offences.
Pershing has been prosecuted by the Australian Securities and Investments Commission (ASIC) for client monies offences and sentenced in Sydney’s Downing Centre Local Court to pay a penalty of $40,0000.
The company pleaded guilty to the charge of breaching client money obligations under the Corporations Act by transferring sale proceeds from international trading in client’s securities from trust accounts to its own general bank account between 1 March, 2916 and 20 December, 2017.
The company also pleaded guilty to a further breach by failing to ensure that client money received on behalf of third party clients was held in segregated client trust accounts.
In handing down the sentence, the magistrate said that there was a strong need for general deterrence even those Pershing Securities was unique in the marketplace.
Commenting on the sentence, ASIC commissioner, Cathie Armour said the outcome sent a strong message that client money breaches were serious.
“Client money obligations protect investors, bolster investor confidence and underpin the integrity of Australian financial markets,” she said.
“If licensees don’t take them seriously they risk criminal conviction.”
