After concerns were raised by the regulator, the Australian Securities and Exchange Commission (ASIC) today announced that retail over-the-counter (OTC) trading firm Ikon Australia Pty Ltd (IKON) has agreed to rectify client trust accounts and improve disclosures, according to an official press release from ASIC.
IKON has agreed to separate out overseas client funds from the client money that it holds in compliance with its obligations under Australia’s Corporations Act laws, since its overseas investors are not associated with the financial services provided under Ikon’s license as an Australian Financial Services (AFS) provider.
Site revision and disclosures
The company has also revised its website as a result of the measures from ASIC and the firm agreed to directly inform its overseas customers that the services provided to them, outside of Australia, are not covered by Australian regulations.
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ASIC noted in the press release that because IKON’s current business structure entailed its overseas clients providing services from offshore locations (i.e. outside of Australia), these services don’t fall under its AFS license.
Mostly offshore clients
The regulator said that Ikon confirmed how only 0.03% of its clients are Australian investors, and ASIC noted that the company is taking steps to obtain consent from each Australian client in order for the firm to transfer their funds into a separate segregated trust account, while also informing the majority of the firms clients which are offshore that their funds aren’t afforded the same benefits under the companies AFS license.
The measures are apparently aimed to help improve transparency with the required disclosures while rectifying the trust accounts to prevent the two groups of domestic and offshore client funds from being co-mingled in the same account. Finance Magnates wrote about IKON Australia earlier this year after Jacob Nel took the helm as CEO of the company. According to information on LinkedIn, Mr. Nel is currently also listed as CEO of IKON Multibank Group.