Australian Appeals Court Denies Broker’s Appeal to be Granted an ASIC License

ASIC revoked the license at the beginning of September as it discovered a change in the ownership of the company.

According to an official announcement by ASIC, the Administrative Appeals Tribunal (AAT) has affirmed the decision of the Australian Financial regulator ASIC to deny the application of Clemente Group Holdings Pty Ltd (CGH) which has applied for an Australian Financial Services License (AFSL).

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The company has been closely scrutinized by the regulator and was formerly known as FXGlobe. The Australian regulator revoked the license of ISM FX at the beginning of September as the regulator discovered a change in the ownership of the company. That decision has also been appealed but the final outcome was not positive for the firm.

Commenting on the decision, J. F. Toohey, Senior Member of the AAT, said: ‘In my assessment of the evidence, the applicant has not demonstrated that it has sufficient technical, human and financial resources to conduct the proposed business and mitigate the risks associated with it, and the sole director, sole shareholder and its sole nominated responsible manager Mr Batten does not appear seriously to have addressed those risks.”

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Welcoming the decision, Peter Kell, the Deputy Chairman of ASIC, said, “The AAT’s decision supports ASIC’s expectation that an application for an AFS licence must be prepared to a high standard. In particular, it should clearly explain the financial services the applicant intends to offer, and provide consistent and credible information to support and demonstrate that the applicant has the ability to deliver the requested financial services in a professional and compliant manner.”

“This case further emphasises the point that in deciding whether to grant a licence, ASIC will also have regard to any prior non-compliant conduct by the applicant, its directors and controllers,” he elaborated.

CGH applied for a license in March 2014, aiming to make a market in derivatives for wholesale clients in the short term with medium term plans expanding into an IB network for wholesale clients and ultimately the on-boarding of retail clients.

 

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