Aussie regulator flagged concerns about FTX months before collapse: Report

Australia’s financial regulator raised concerns about FTX Australia not long after it began operations in March 2022, according to documents.

Australia’s financial regulator reportedly raised concerns over FTX’s local Australian subsidiary as much as eight months before the exchange met its untimely end in November.

According to documents obtained by Guardian Australia, officers of the Australian Securities and Investments Commission (ASIC) were concerned about the way in which FTX Australia was operating as it was able to obtain a license in the country through a company takeover.

As per a previous report from Cointelegraph, FTX acquired its Australian financial services license (AFSL) by taking over financial institution IFS Markets in December 2021 before opening up for business months later in March 2022.

This is allowed FTX Australia to effectively sidestep the same level of scrutiny that is usually applied to new AFSL licensees, according to its ASIC chief Joe Longo.

As per newly obtained documents, the regulator reportedly issued a Sect 912C notice to FTX the same month it began operating, which required the crypto exchange to provide documents about its operations for ASIC to assess if it met AFSL license conditions.

With the notice, ASIC can direct the licensee to provide documents specifying what financial services they provide, the financial services business carried on by the licensee and to determine if the licensee satisfies the "fit and proper person test."

A briefing document obtained by the outlet has also confirmed that in the months between the initial concern and FTX collapsing on Nov. 11, the regulator had put the exchange under “surveillance activity” and a total of three notices were issued to FTX.

The document schedule also reveals that the regulator was still concerned about FTXs operations as late as October 2022.

Cointelegraph reached out to ASIC for a comment but did not receive a response before publication.

FTX Australia was one of more than 130 FTX-linked companies that halted operations after its parent company FTX went into bankruptcy proceedings on Nov. 11, 2022.

The Australian subsidiary of FTX had its financial license suspended on Nov. 16, 2022, and has gone into voluntary administration.

It's estimated around 30,000 Australian customers and 132 companies are owed money or crypto from the exchange.

from https://ift.tt/gV72mWp
https://ift.tt/jFp5kWs

Comments

DeFi isn’t dead, it just needs to fix these 3 critical problems

It’s been a rough year for DeFi, and it may not get any better until projects focus more on security, regulation and usability. The persistent challenges decentralized finance face have been well documented by a handful of analysts and the recent collapse of the Terra ecosystem re-enforced the fact that something is critically wrong with DeFi. I think DeFi today is completely broken for 99% of the population. The promise of a more transparent financial system has been overtaken by greed. UST/LUNA is just the latest in a string of bad developments: — Peter Yang (@petergyang) May 11, 2022 Let's take a look at what experts say DeFi needs to do in order to have another revival. Improved usability To date, the promise of open and uncensored access to a global decentralized financial system has been largely hampered by the complicated interface, confusing multi-step staking processes and lack of clarity surrounding the yields on various tokens. What do you thi...

ENS DAO delegates offer perspective on DAO governance and decentralized identity

AlphaWallet CEO and Spruce co-founder talk about their roles as contributors to the Ethereum Name Service following the project's recent airdrop. Earlier this month, the Ethereum Name Service, or ENS, formed a decentralized autonomous organization, or DAO, for the ENS community. Cointelegraph spoke to two ENS DAO delegates who applied for the opportunity to represent the community and stay involved in the decision making process: Victor Zhang, CEO of AlphaWallet, an open source Ethereum wallet, and Gregory Rocco, co-founder of Spruce, a decentralized ID and data toolkit for developers. Zhang spoke about his experience as an external contributor to ENS and an early supporter since 2018. Zhang initially sought to help ENS by offering Alpha Wallet as a user-friendly tool for resolving .eth names and cryptocurrency wallet addresses. Essentially, if a user inputs an .eth name in the AlphaWallet, it will show the wallet address, and vice versa using reverse resolution. Alpha...

National Futures Association adds rules for members handling digital assets

The CFTC-linked self-regulatory organization (SRO) has disclosure rules for members engaging in activities with BTC and ETH; now, standards of conduct are being added. The National Futures Association (NFA), the United States self-regulatory organization for derivatives markets, has issued a new compliance rule addressing members’ conduct. The new rule complements requirements issued in 2018. The NFA has “well over 100” members that engage in activities with digital asset commodities, but no way to address fraud or misconduct committed by those members, the organization explained to secretary of the Commodity Futures Trading Commission (CFTC) Christopher Kirkpatrick in a Feb. 28 letter as it submitted the proposed new rule for approval. The new rule is modelled on the NFA’s antifraud rules for exchange traded futures and swaps transaction and retail foreign exchange. The NFA is the only registered self-regulatory organization that has delegated authority from the CFTC, giving it a...

Crypto Coin Search

Search This Blog