Sirius Financial Markets surrenders AFS license following ASIC investigation
The Australian Securities and Investments Commission (ASIC) announces that over-the-counter (OTC) derivatives provider Sirius Financial Markets Pty Ltd, trading as ‘Trade360’, has surrendered its Australian Financial Services licence.
The surrender of the license follows an ASIC investigation.
The regulator has also banned two of Sirius Financial’s former executives, Mr Jonathan Schneider and Mr Oskar Pecyna, from controlling an entity that carries on a financial services business or performing any executive or management role in relation to a financial services business for eight years.
Sirius Financial engaged an off-shore call centre, Toyga Media Ltd (Toyga), to source clients to trade in high-risk CFDs and margin Forex contracts products issued by Sirius Financial. ASIC’s investigation found the call centre representatives persuaded Sirius Financial clients to trade using pressure selling tactics and provided clients with personal advice when Sirius Financial was not licenced to do so. Sirius Financial was also found to have engaged in unconscionable conduct and conduct that was likely to mislead or deceive.
ASIC’s investigation also found that, in failing to take adequate steps to address Toyga’s conduct, Sirius Financial has breached its licence obligations to:
- do all things necessary to ensure that the financial services covered by the licence are provided efficiently, honestly and fairly
- take reasonable steps to ensure that its representatives comply with the financial services laws
- have in place adequate arrangements for the management of conflicts of interest.
In banning Mr Pecyna and Mr Schneider, ASIC found both men were involved in Sirius Financial’s breaches of its licence obligations and were not adequately trained or competent to be involved in the control of a financial services business. In reaching these findings, ASIC found that both men failed to adequately perform their duties as responsible managers and lacked the necessary professionalism, integrity, judgement and diligence to play a role in the management or control of a financial services provider.
Also following ASIC’s investigation, Sirius Financial will surrender its licence and wind down retail and wholesale operations and will cease providing financial services on 29 July 2022.
ASIC has taken previous action against OTC derivates providers, which has resulted in penalties handed down by the Federal Court. AGM Markets was ordered to pay a $75 million penalty and Forex CT ordered to pay a $20 million penalty for various breaches of the Corporations Act, including unconscionable conduct.