The regulator said it had commenced proceedings in the Australian Federal Court to stop Monarch FX Group and its former general manager, Quinten Hunter, from acting as a financial services provider.
“ASIC is concerned that Monarch FX is not licensed or authorised to operate the following services: managed discretionary account (MDA) services [and] recommending members establish a [SMSF] to purchase its memberships,” a statement from ASIC said.
ASIC also said it is concerned the company is not licensed to arrange for its members to enter into foreign exchange contracts – another service it provides.
Monarch FX has been restrained from providing financial services until 21 November, when the matter will be resumed in the Federal Court.
The corporate regulator’s action against Pepperstone Group followed its discovery that the company was providing financial services in Japan without being licensed by the Japanese Financial Services Agency.
“ASIC became aware that Pepperstone was also advertising its products through a Japanese mirror website and that it has a number of clients based in Japan to whom it offers margin foreign exchange services,” a statement from ASIC said.
“[An Australian financial services (AFS) licence] does not permit AFS licensees to offer financial services in other jurisdictions where approval may be required from the local regulatory authority,” it said.
Pepperstone has agreed to cease providing financial services in Japan and recently announced it has emailed all existing Japanese clients to inform them it does not hold a licence.
“All holders of an AFS licence must ensure that, when providing financial services in foreign jurisdictions, they understand and comply with the regulatory requirements of offering a service in that jurisdiction,” ASIC commissioner Cathie Armour said.
“ASIC will continue its focus on entities that are licensed in Australia but appear to conduct most of their business offshore. As part of ASIC’s ongoing work, we will liaise with international regulators.”
