ACY Securities is the latest company to close its doors for Chinese clients and inform them that they have to close their open positions before the end of the month. The Australian Securities and Investments Commission (ASIC) has been actively pressuring the industry to stop servicing customers from Greater China after discussions with Chinese authorities.
As the deadline for Australian brokers to submit data requested by ASIC related to Chinese clients approaches, more and more brokers are returning deposits to their clients from mainland China. The move comes on the heels of an increasing prospect for product intervention measures on part of the financial watchdog in the land down under.
In what seems like a political decision, the Australian regulator’s representatives have made several visits to mainland China, seeking more information on the business practices of ASIC-regulated brokers.
ACY Securities Avoids Confrontation with ASIC
While some firms are allegedly looking to resist pressure from the Australian watchdog and fight in court, others are taking a warning issued by the ASIC in April very seriously. To date, a number of brokers have shut down their doors to customers from China, including Vantage FX, and Chinese owned IFGM.
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Earlier this week, AETOS became the latest broker to exit the Chinese market. Another company that has a subsidiary regulated by the ASIC, MultiBank Group, earlier this week announced that it is acquiring the client and operational base of AETOS in China.
Customers of ACY Securities received the following message earlier today: “In order to ensure compliance with our obligations as an Australian financial services licensee, ACY Securities Pty Ltd will be no longer servicing clients from Greater China Regions.”
Customers of the brokerage from China will be forced to close their positions by Friday, the 28th of June. Provided that some clients do not close their positions, they will be automatically closed on the 29th at the price levels at market close. Accounts will be closed before the 30th June.
A company representative mentioned to Finance Magnates that difficulties in doing business in China continue to increase. Local authorities are increasing the pressure on the industry, with many companies heading for the exit earlier this spring.