ASIC: Local FX broker market surprised by ‘intense’ letters
As I flagged a few weeks ago, ASIC has been giving out signals that it’s about to get tougher on implementing best behaviour for AFSL holders but even I was surprised that they seem to have morphed from a cuddly, friendly Koala to a claw-sharpened Drop-Bear overnight!
I believe that every derivatives, market-making license holder under ASIC’s jurisdiction received some very intense letters from the local regulator yesterday, and the level of detail demanded has been described to me as being ‘unprecedented’. The focus seems to be on the nature and location of individual trading accounts as well as the exact business nature of CARs (corporate authorised representatives) issued by the AFSL holder.
This action by ASIC would seem to have been in some part prompted by complaints from Chinese authorities that Australian-based brokers were the main destination of Chinese retail traders, carrying out activity which is unregulated in China. We should be in for plenty of speculation in the weeks ahead as ASIC collects all the required data.
May you live in interesting times.