Chinese forex traders and, to an even greater extent, Chinese affiliates are known for their activism whenever they think a firm has wronged them in any way. According to new media reports from China, a large group of traders and affiliates came to the local offices of an international broker in Heilongjiang Province in protest a few days ago.
The targeted company this time was AETOS Capital Group. It is regulated by the Australian Securities and Investments Commission (ASIC) as an FX broker, holding a local licence which authorizes AETOS to run a financial services business in Australia. However, according to the original report from our colleagues at waihuiTV, AETOS primarily targets the Chinese market and only has a staff of four people in Australia.
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It has been a common practice for China-centered brokers to seek regulations in Australia or New Zealand over the past years, as they are perceived as the most competent regulators in the Asia-Pacific region. As ASIC has seen that it needs to invest much of its time and resources to monitor firms having no significant client base in Australia, it recently clamped down on international brokers.
The protesters accused AETOS of stealing their money and operating against local regulations, but the exact details are unclear. It is known that the main organizers of the protest were former AETOS affiliates themselves. In the Chinese industry it is a common perception that affiliates hold most of the power in the trader-affiliate-broker relationship.
In January, there were two reported instances of heated protest at IronFX’s offices in Shanghai, culminating in a violent attempt to attack a company executive. This came after ex-IronFX affiliates went on television to accuse the broker of wrongdoing.