News Nuggets | 4 October: SEC Halts Ponzi Scheme; FCA Updates Warning List

SEC Halts Zera Financial's Alleged Ponzi Scheme

The US Securities and Exchange Commission (SEC) has obtained an emergency court order to stop an alleged Ponzi-like scheme run by Zera Financial LLC and its owner, Luis A. Romero. The scheme reportedly raised over $2.2 million from approximately 170 investors. According to the SEC's complaint, Zera and Romero promised investors 3% monthly returns, translating to over 36% annual returns, on investments as low as $500. They also falsely claimed that the investments were FDIC-insured.

The SEC alleges that Zera and Romero had no significant business operations other than raising funds from investors and making Ponzi-like payments. Romero is accused of misusing investor funds for personal expenses, including an electric truck and tropical fish, as well as depositing large sums into various cryptocurrency accounts.

FCA Issues Warnings against Unauthorized Firms

The Financial Conduct Authority (FCA) has issued a number of warnings against several unauthorized firms this week. These include GBG Limited, GainGround, and Asset Flow Traders. All three firms are not registered or authorized by the FCA and have been targeting people in the UK.

The warnings serve as a cautionary note for individuals and investors to be wary of dealing with these unauthorized firms. The FCA regularly updates a list of such firms and individuals to protect the public from potential scams and fraudulent activities.

Watch out for these bad boys on @TheFCA warning list: pic.twitter.com/UvG55slfhO

— Damian Chmiel (@ChmielDk) October 4, 2023

ClearBank Group Holdings Expands Board for Global Growth

ClearBank Group Holdings has announced the appointment of four new non-executive directors as it gears up for international expansion. The new appointees include Peter Herbert as the Group Chair, Tim Wade as the Senior Independent Director, Richard Anderson as the Group Chair of the Risk Committee, and Susanne Hannestad as a Non-Executive Director.

The new board members bring a wealth of experience in banking, payments, and business transformation. Peter Herbert previously served as the Chair for the Bank of Ireland (UK) and Zopa Bank. Tim Wade has senior management experience with Royal Bank of Canada Europe Ltd and Virgin Money PLC. Richard Anderson and Susanne Hannestad also bring specialized skills in risk management and global operations, respectively.

The appointments are expected to significantly contribute to ClearBank's international growth plans over the next year.

FIA Tech Opens Atlantis Platform to Buyside Market

FIA Tech, a leading technology provider in the futures industry, has expanded its Atlantis settlement platform to include buyside market participants. The platform, which processes over 170 million trades annually, will now allow clients to manage execution brokerage payments directly. The first buyside participant to join Atlantis is a multi-billion dollar, multi-strategy hedge fund.

Atlantis streamlines the calculation, invoicing, and payment of brokerage fees, offering high rates of automation and integrated workflows. The platform currently has 45 institutions settling across 34 clearing houses globally. Nick Solinger, the President and CEO of FIA Tech, stated that firms using Atlantis have seen up to 99% automated settlement rates and have doubled or tripled the productivity of their brokerage payables and receivables teams.

ABN Amro Sells Stake in EMS to Fiserv

ABN Amro has sold its 49% stake in digital payments business EMS to Fiserv. The Netherlands-based EMS provides technology for processing payments between merchants and customers and has a client base spanning 25 markets.

The sale comes after ABN Amro concluded that EMS would be better served by being wholly owned by Fiserv. Financial terms of the deal were not disclosed. Fiserv had previously owned 51% of EMS and has now acquired the remaining stake.

Federal Court Orders Provide Capital to Produce Documents

The Federal Court has ordered Provide Capital to produce documents it had failed to supply in advance as part of an ongoing investigation by the Australian Securities and Investments Commission (ASIC). The court noted that there had been a history of delay and obfuscation on the part of Provide Capital in complying with the notice.

Provide Capital must produce the documents within 28 days, including unredacted copies of previously redacted documents. The court emphasized that any confidentiality obligations must yield to statutory requirements.

Seoul Aims to Become Fintech Powerhouse

Seoul plans to invest five trillion won ($3.7 billion) to transform the city into a global fintech hub. Seoul Mayor Oh Se-hoon made the announcement during the opening ceremony of Seoul Fintech Week 2023. The Seoul Vision 2030 Fund will channel the investment over the next four years.

Mayor Oh stated that the current economic challenges offer new opportunities for Seoul, which aspires to be among the top five financial cities in the world. The city plans to secure a 50,000-square-meter space in Yeouido, Seoul's financial district, to nurture a fintech ecosystem and rebrand the city as a digital financial hub.