ASIC has cancelled the Australian financial services (AFS) licence of contracts for difference (CFDs) and foreign exchange contracts issuer, FXOpen AU Pty Ltd (FXOpen AU), after an investigation identified serious concerns about the inadequacy of its human resources to provide financial services and to carry out supervisory arrangements.
ASIC’s investigation also found that FXOpen AU failed to comply with its obligations as an AFS licensee, including:
maintaining competence to provide financial services covered by the licence
complying with the ‘key person’ condition on its licence, and
complying with financial services laws.
FXOpen AU has held AFS licence 412871 since 12 December 2011, allowing it to issue CFDs. CFDs are leveraged derivative contracts that allow a client to speculate in the change in value of an underlying asset, such as foreign exchange rates, stock market indices, single equities, commodities or crypto-assets.
ASIC found FXOpen AU’s failure to comply with its core obligations as an AFS licensee warranted the cancellation to protect existing and future clients from likely future breaches of its core obligations. By cancelling the licence, ASIC also aims to deter other AFS licensees from failing to comply with their obligations, promote the objects of fairness, honesty and professionalism by those who provide financial services and support confident and informed participation of investors and consumers in the financial system.
