Australia financial regulator ASIC has announced that it has applied to the Federal Court to wind up retail OTC derivative issuer Prospero Markets Pty Ltd.

ASIC commenced its investigation into Prospero following the Australian Federal Police’s Operation Avarus-Nightwolf which resulted in former officers and responsible managers of Prospero Markets being charged with money-laundering offences in October 2023 relating to the Changjiang Currency Exchange money remitting chain.

ASIC said it holds a broad range of concerns regarding the management of Prospero’s business, including in relation to compliance with its Australian Financial Services (AFS) License conditions and obligations as an OTC derivatives issuer under the Corporations Act.

Prospero Markets’ AFS license was later suspended in December 2023, technically after Prospero failed to lodge its 2023 audited financial accounts.

ASIC noted that it understands that Prospero holds substantial client funds and is concerned to see these returned to clients as a priority. ASIC considers that the best way to secure the efficient return of funds to clients is the appointment of liquidators.

ASIC has applied for the court to appoint Andrew Cummins, Jonathon Keenan and Peter Krejci, of BRI Ferrier, as joint and several liquidators of Prospero. BRI Ferrier was also the administrator and liquidator for another Australia based Retail FX and CFDs broker that went bankrupt, USGFX.

The Prospero Markets matter is listed for a hearing in the Federal Court on 20 March 2024.