KVB Kunlun Financial Group Limited is erring on the side of caution when it comes to its clients based in the People’s Republic of China (PRC), with the company announcing that it has completed disengaging with certain clients of its Australian and New Zealand subsidiaries.
Specifically, in a statement filed through Hong Kong Exchanges and Clearing Limited (HKEX), the company’s board confirmed that it had identified anyone who is, or who may possibly be, classified as a PRC domestic client, and has ceased offering their services.
“In line with the advice from the Company’s legal advisers on the PRC laws, and in light of the heightened regulatory expectations of the PRC regulators, the Company took a conservative approach and deemed clients who were unable to provide overseas residential address proof as actual or potential PRC domestic clients and disengaged these clients,” the statement said.
According to the statement, approximately 95 percent of clients of the Group have been identified as actual or potential PRC domestic clients and been disengaged. Looking forward, the company will be refocusing its efforts to maintain its remaining client base.
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KVB Kunlun to explore institutional opportunities
Furthermore, KVB Kunlun will focus on expanding its client base. Specifically, the broker is looking to diversify its client base to include both overseas Chinese speaking and non-Chinese speaking clients in Australia and New Zealand. The firm will also explore offering its services to institutional clients.
“The Group will bring in experienced staff with relevant experience and knowledge to join the Group to strengthen current marketing and business development personnel of the Group to assist in implementing the Group’s proposed business plan. The Group is in the process of meeting potential candidates to actively recruit personnel with relevant experience in the leveraged FX business,” the statement added.
The announcement from the Group follows on from the Australian Securities and Investments Commission (ASIC) issuing firms an urgent letter in April to suspend onboarding clients from overseas, where the firms are not regulated.
As Finance Magnates reported, although the focus of the regulator’s message could have been pointing at the European Union, the letter specifically mentioned China, a country that is integral to Australia’s economy.