The
Australian Securities and Investments Commission (ASIC) has taken legal action
to wind up a retail over-the-counter (OTC) derivative issuer, Prospero Markets
Pty Ltd (Prospero), over its alleged involvement in a money-laundering scheme.
Prospero,
which offers derivatives and FX contracts to retail and wholesale clients, is
accused of breaching its Australian Financial Services (AFS) License conditions
and obligations under the Corporations Act.
ASIC’s
application to the Federal Court follows an investigation by the Australian
Federal Police (AFP) into the Changjiang Currency Exchange money remitting
chain, which allegedly laundered millions of dollars for criminal syndicates.
The AFP’s operation,
codenamed Avarus-Nightwolf, led to the arrest of several former officers and
responsible managers of Prospero in October 2023 who were allegedly involved in
the illegal proceedings. The Changjiang Currency Exchange was allegedly
operated covertly by the Long River money laundering group. It’s implicated in
cleansing nearly $229 million from criminal activities over the last three
years.
We have applied to the Federal Court to wind up retail #OTC derivative issuer Prospero Markets to secure the efficient return of client funds. Our investigation follows former officers and responsible company managers being charged with money laundering https://t.co/3T6bUqetoL pic.twitter.com/IrbF3J0ZnN
— ASIC Media (@asicmedia) March 1, 2024
ASIC also
suspended Prospero’s AFS Licence in December 2023 after the company failed to
lodge its 2023 audited financial accounts.
The
regulator said it was concerned about the return of substantial client funds
held by Prospero and believed that the appointment of liquidators was the best
way to secure their efficient distribution. ASIC has nominated Andrew Cummins,
Jonathon Keenan and Peter Krejci, of BRI Ferrier, as joint and several
liquidators of the brokerage.
The matter
is scheduled for a hearing in the Federal Court on 20 March 2024.
ASIC’s Recent Enforcement
Actions
ASIC has
been proactive in regulating the financial market to protect investors and
maintain market integrity. Recently, ASIC secured a bankruptcy order against
Tyson Scholz, a social media influencer known as “ASX Wolf,” for failing to pay
AU$456,296.64 as ordered by the court. This action underscores ASIC’s
commitment to enforcing legal judgments and ensuring that individuals comply
with financial regulations.
Moreover,
Russell Sandiford, a former Director of Reiwa-Capital, has pleaded guilty to
two charges of dishonest conduct concerning the mismanagement of client
investments. Sandiford’s admission sheds light on the fraudulent activities
within the financial sector, particularly concerning a scheme that promised
significant returns but only distributed 1% of nearly $500,000 collected from
investors to clients.
Additionally,
an Australian federal court found Web3 Ventures Pty Ltd, trading as Block
Earner, guilty of offering crypto products without the requisite financial
services license. This ruling represents a significant step in regulating the
burgeoning crypto market, highlighting ASIC’s role in overseeing new financial
products to ensure they comply with existing laws.
The
Australian Securities and Investments Commission (ASIC) has taken legal action
to wind up a retail over-the-counter (OTC) derivative issuer, Prospero Markets
Pty Ltd (Prospero), over its alleged involvement in a money-laundering scheme.
Prospero,
which offers derivatives and FX contracts to retail and wholesale clients, is
accused of breaching its Australian Financial Services (AFS) License conditions
and obligations under the Corporations Act.
ASIC’s
application to the Federal Court follows an investigation by the Australian
Federal Police (AFP) into the Changjiang Currency Exchange money remitting
chain, which allegedly laundered millions of dollars for criminal syndicates.
The AFP’s operation,
codenamed Avarus-Nightwolf, led to the arrest of several former officers and
responsible managers of Prospero in October 2023 who were allegedly involved in
the illegal proceedings. The Changjiang Currency Exchange was allegedly
operated covertly by the Long River money laundering group. It’s implicated in
cleansing nearly $229 million from criminal activities over the last three
years.
We have applied to the Federal Court to wind up retail #OTC derivative issuer Prospero Markets to secure the efficient return of client funds. Our investigation follows former officers and responsible company managers being charged with money laundering https://t.co/3T6bUqetoL pic.twitter.com/IrbF3J0ZnN
— ASIC Media (@asicmedia) March 1, 2024
ASIC also
suspended Prospero’s AFS Licence in December 2023 after the company failed to
lodge its 2023 audited financial accounts.
The
regulator said it was concerned about the return of substantial client funds
held by Prospero and believed that the appointment of liquidators was the best
way to secure their efficient distribution. ASIC has nominated Andrew Cummins,
Jonathon Keenan and Peter Krejci, of BRI Ferrier, as joint and several
liquidators of the brokerage.
The matter
is scheduled for a hearing in the Federal Court on 20 March 2024.
ASIC’s Recent Enforcement
Actions
ASIC has
been proactive in regulating the financial market to protect investors and
maintain market integrity. Recently, ASIC secured a bankruptcy order against
Tyson Scholz, a social media influencer known as “ASX Wolf,” for failing to pay
AU$456,296.64 as ordered by the court. This action underscores ASIC’s
commitment to enforcing legal judgments and ensuring that individuals comply
with financial regulations.
Moreover,
Russell Sandiford, a former Director of Reiwa-Capital, has pleaded guilty to
two charges of dishonest conduct concerning the mismanagement of client
investments. Sandiford’s admission sheds light on the fraudulent activities
within the financial sector, particularly concerning a scheme that promised
significant returns but only distributed 1% of nearly $500,000 collected from
investors to clients.
Additionally,
an Australian federal court found Web3 Ventures Pty Ltd, trading as Block
Earner, guilty of offering crypto products without the requisite financial
services license. This ruling represents a significant step in regulating the
burgeoning crypto market, highlighting ASIC’s role in overseeing new financial
products to ensure they comply with existing laws.
