The Australian Securities and Investments Commission (ASIC) has mandated FXPrimus to stop providing margin foreign exchange and contracts for difference (CFDs) trading to Australian residents. A detailed statement made by the Australian regulator sheds light on the status of FXPrimus and the firm’s IPO on the Australian Stock Exchange.
According to ASIC, the brokerage has agreed to make the necessary changes to its websites and notify Australian clients that it does not hold a license to provide financial services in the country. The regulator explains in its statement that FXPrimus Australia Pty Ltd has been an authorized representative of HLK Group Pty Ltd.
However, that license has only been valid to provide general advice and does not provide sufficient authorization to the company to deal, issue or make a market in derivatives in Australia. In addition, FXPrimus Australia Pty Ltd has confirmed to the regulator that it is no longer a corporate authorized representative of HLK Group Pty Ltd.
Moving on to the initial public offering process which was recently under the radar of Australian press, ASIC shared that after discussions between the regulator and the company, they have consented to halt its IPO under a prospectus issued on April 16th as already exclusively reported by Finance Magnates.
The Australian regulator has highlighted a recent sponsorship deal with Australian-based football club Melbourne City as an effort to to target Australian investors.
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Commenting on the announcement, ASIC Commissioner Cathie Armour said, “Financial service providers must ensure that they are properly licensed or authorized in Australia before they promote financial services to Australian investors. ASIC will not hesitate to take action where we have concerns Australian investors are being targeted by unlicensed or unauthorized operators.”
ASIC explained that the various entities within the FX Primus group of companies have not been authorized to offer their services in Australia since they do not hold an Australian Financial Services (AFS) license.
The brokerage is presently operating through a couple of websites, namely www.fxprimus.com, www.fxprimus.eu and www.fxprimusgroup.com.
The regulator highlights a couple of misleading statements found on the websites of the FXPrimus, such as, “FX Primus is operating under the jurisdiction of the Australian group of companies Securities & Investment Commission (ASIC)” and “FX Primus is operating under ASIC regulations.”
Following communication between the company and ASIC the statements have been removed by the company.