The Australian Securities and Investment Commission, or ASIC, has made an announcement on Thursday. This announcement is in regards to it suspending the Australian Financial Services (AFS) license of Forex Plus Australia Pty Ltd (Forex Plus). Furthermore, the regulator has canceled the AFS license of one Squareknot Pty Ltd.
Suspension Due To Lack Of Using Licenses
ASIC had suspended the AFS license for Forex Plus for the span of six months. According to the Australian watchdog, this license was suspended due to ASIC releasing that the company had not been providing financial services to the public at large for some time, now.
The Corporations Act allows the Australian regulator to suspend or outright cancel the AFS license of a company, should the license holder in particular outright cease providing financial services within the country. Forex Plus had been authorized to give advice and make a market for forex contracts, aiming at wholesale clients in particular.
New Powers, New Consequences
Back in February of this year, ASIC was granted a new power, allowing it to cancel both the AFSL, as well as the Australian Credit Licenses of licensees, should they not begin operations within six months of the license itself being granted.
Another nail in the coffin came from ASIC, stating that Forex Plus had failed to lodge its audited accounts to the regulator for a few years, now. Even so, the company itself has the right to appeal against the decision ASIC had made, presenting it to the Administrative Appeals Tribunal.
Through a public statement made today, ASIC explained the reasoning why it suspended Forex Plus’s license instead of outright canceling it. According to the regulator, the company has indicated to the watchdog that it may very well renew its provision of financial services. However, for that to occur, Forex Plus must first lodge its audited accounts within this suspension period, should it plan to renew its provision of financial services, according to ASIC.
Squareknot Fails To Deliver
Squareknot, however, had its license outright canceled by ASIC. According to the regulator, the Sydney-based financial services provider had failed to meet the base level of financial requirements it needed to continue holding the license. The company had initially gained the license in December of 2015, being authorized to deal in and offer general advice regarding securities for wholesale clients.
It seems that Australia is taking steps to keep a tighter grip on its financial industry, particularly those who hold licenses and who doesn’t. With any luck, it will do the country, and more importantly, its investors, more good than evil.