The Australian Securities and Investments Commission (ASIC) announced this Friday that it has cancelled the Australian Financial Services (AFS) licence of Union Standard International Group Pty Ltd, which operates under the brand USGFX.
The cancellation of USGFX’s AFS licence follows on from the foreign exchange (forex) broker being ordered to enter into liquidation by the Federal Court of Australia earlier this month.
According to ASIC’s statement today, the broker’s licence (AFS licence 302792) was cancelled on 14th September 2020 because the company has entered into liquidation, under section 915B of the Corporations Act 2001 (Cth) (Corporations Act).
Despite the cancellation, the Australian regulator outlined today that it will allow the liquidators: Andrew Cummins and Peter Krejci of BRI Ferrier (NSW) Pty Ltd, to conduct certain necessary activities under the AFS licence until 18th December 2020.
This includes having a dispute resolution scheme in place, and arrangements for compensating retail clients. Additionally, the liquidators will continue to hold professional indemnity insurance and be able to terminate existing arrangements with current clients.
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In its statement today, the Aussie watchdog highlights that the Australian-based FX broker has 28 days from the cancellation date to apply to the Administrative Appeals Tribunal (AAT) for a review of ASIC’s decision.
USGFX is the Australian entity of Union Standard International Group Holdings (USG). In July, Finance Magnates broke the news that USGFX had entered into voluntary administration, claiming that ASIC’s attacks on the company had damaged its reputation.
Namely, the broker claimed that ASIC had brought legal actions against the company “despite no substantial allegations against USGFX being brought to court by ASIC since last December”, the broker said at the time.
Before it went into voluntary administration in July, the Group had its headquarters in Australia. However, as a result of USGFX’s issues, the Group has moved its headquarters to London, where it has an entity regulated by the Financial Conduct Authority (FCA).
As Finance Magnates reported, Krejci and Cummins previously alerted shareholders and creditors that they would be putting the broker into liquidation following difficulties they faced in conducting their external administration from Soe Hein Minn, the director and the majority shareholder of the broker, and his representatives.