Retail broker AFS Capital has license cancelled by ASIC
China-focused retail shares and forex brokerage Australian Golden Securities Ltd, formerly known as AFS Capital Securities Ltd, has had its Australian financial services license cancelled by Australian financial regulator ASIC. The cancellation became effective as of May 21, 2020.
ASIC stated that it cancelled the licence because the company has not addressed ASIC’s concerns about its failure to meet its licensee obligations. Specifically, Australian Golden Securities has failed to:
- lodge its financial and audit reports, and
- address its failure to maintain adequate competence and capacity to provide the financial services covered by its AFS licence.
The regulator had initially suspended the company’s license late last year. AFS Capital had held its ASIC license since 2010, establishing the company in Australia targeting Chinese nationals who increasingly wanted to work with a broker in Australia. The company also worked to help Chinese (and other) companies list on the Australian Stock Exchange (ASX).
In 2017, ASIC had banned AFS Capital director Dr. Bingxing Hu, resident at the time in Melbourne, Australia, for a period of five years. At the time, following a hearing, an ASIC delegate found that Dr. Hu failed to comply with a financial services law by knowingly engaging in conduct that was likely to mislead in contravention of Australia’s Corporations Act. The ASIC delegate also found that Dr Hu may not have been adequately trained, or not competent, to provide financial services, having demonstrated by his conduct a disregard and a misunderstanding of the rules applying to the financial services that he was providing.
In June 2019, following Dr Hu making an application to ASIC, the banning order was varied by ASIC by reducing the banning period from five years to four and a half years. In July 2019, Dr Hu applied for review of the ASIC variation decision. The application for review was subsequently withdrawn. Dr Hu remains banned from providing financial services.