The Australian Securities and Investments Commission (ASIC) announced this Monday that it has banned Steven Marsh, a former employee of Forex Capital Trading Pty Ltd (Forex CT), from providing financial services for three years.
Marsh’s ban comes less than a month after ASIC canceled the Australian financial services (AFS) license of Forex CT, a retail over the counter (OTC) derivative issuer.
As Finance Magnates reported, the firm’s license was canceled because its business model disregarded key obligations of an AFS licensee, resulting in unconscionable conduct, misleading and deceptive conduct and a failure to manage conflicts of interest, the regulator said
At Forex CT, Marsh was employed with the company as an account manager between the 19th of February 2018 and the 20th of March 2019. During this time, he interacted with clients to trade in contracts for differences (CFDs) and margin foreign exchange (forex) contracts.
However, the Australian regulator found that Marsh did not comply with financial services law, is not adequately trained or is not competent to provide financial services, and is not a fit and proper person to provide financial services.
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Furthermore, the regulator discovered that he made misleading representations to clients, such as claiming they would make profits when trading with Forex CT, despite CFDs being speculative and sometimes high-risk investments.
Marsh also told clients that if they made increased deposits into their trading accounts, it would reduce their risks of incurring trading losses. However, this actually would lead to clients having more funds at risk of losses.
ASIC: Marsh engaged in unconscionable conduct
“ASIC also found Mr Marsh engaged in unconscionable conduct. This included engaging in high pressure sales strategies and unfair practices in order to encourage clients to make deposits or delay or cancel client requests to withdraw their own funds from their trading accounts,” the watchdog said in its statement today.
As a result of its investigation, the Australian authority discovered that Marsh was not adequately trained or competitive and did not provide clients with general advice warning. Furthermore, Marsh provided personal advice to customers, the regulator said.
Although ASIC has imposed the three-year ban on Marsh, he does have the right to appeal the decision at the Administrative Appeals Tribunal and ask for a review.