By Jim Bulling and Felix Charlesworth
On 1 May 2018, the Australian Securities and Investments Commission (ASIC) released its revised Information Sheet 225 which provides an updated guidance on initial coin offerings (ICOs). The updated report expands its scope to include guidance dealing with other crypto-currency and digital token (Crypto-Asset) businesses.
By Jim Bulling and Michelle Chasser
The Australian Government has authorised a new external dispute resolution (EDR) scheme for financial disputes, the Australian Financial Complaints Authority (AFCA). AFCA will replace the current EDR schemes, FOS, CIO and the Superannuation Complaints Tribunal (SCT), to create a ‘one stop shop’ with higher monetary limits for consumer and small business complaints against financial service providers including roboadvisers, marketplace lenders, payments providers and their representatives.
AFCA will commence accepting complaints from 1 November 2018 and any complaints not yet resolved by FOS or CIO will be transferred to AFCA. The SCT will continue to resolve its existing complaints but will not accept new complaints after 31 October 2018.
All Australian financial services licensees and credit licensees with retail clients have an obligation to become a member of AFCA by 21 September 2018. Existing members of FOS or CIO must also retain their existing memberships until further notice.
AFCA will soon seek public comments on the new AFCA Rules and interim funding model. Which will then need to be approved by the Australian Securities and Investments Commission.
By Jim Bulling and Felix Charlesworth
On 27 April 2018, the Australian Securities Exchange (ASX) released a consultation paper seeking industry feedback on its proposed implementation and development of a blockchain-based system to perform clearing, settlement and other post trade services in the Australian equity market. As previously mentioned, it is intended that this new platform will replace the existing Clearing House Electronic Sub-Register System (CHESS) which has been used by the ASX since 1995.
By Jim Bulling and Edwin Tan
On 26 April 2018, John Price of the Australian Securities and Investments Commission (ASIC) highlighted in a speech that Australian corporate and consumer laws might still apply to ICOs created and offered from overseas, so long as they were offered and sold to Australian consumers. Mr Price warned that there was an incorrect perception that Australian regulations did not apply to activities engaged from overseas.
By Jim Bulling and Felix Charlesworth
On 16 April 2018, representatives from the Australian Securities and Investments Commission (ASIC), Australian Transaction Reports and Analysis Centre (AUSTRAC) and the Australian Tax Office (ATO) convened in Melbourne and delivered presentations outlining their regulatory views on Initial Coin Offerings (ICOs) and blockchain technology in general.
By Jeremy McLaughlin and Dan Cohen
The Investor Protection Bureau of the New York Office of the Attorney General (Bureau) has established the “Virtual Markets Integrity Initiative,” which the Bureau describes as a “fact-finding inquiry into the policies and practices” of virtual currency exchanges. The Bureau launched the initiative “to increase transparency and accountability in the virtual currency marketplace—and better inform the actions of enforcement agencies, investors, and consumers in this space.”
By Yuki Sako
As a response to the fallout resulting from the hacking of Japanese cryptocurrency exchange Coincheck Inc., which resulted in $530 million worth of digital currencies being stolen, on April 10, 2018, the Financial Services Agency of Japan (FSA) hosted the first meeting of the Study Group on Virtual Currency Exchange Service Providers (Study Group).
By way of background, beginning April 2017, Japan required virtual currency exchange service providers (Virtual Currency Exchange(s)) to be registered with the Japanese authority. Registered Virtual Currency Exchanges are subject to certain operational requirements and conduct regulations such as verification of customers’ identities and customer disclosure.
By Michelle Chasser and Jim Bulling
In a recent speech on building trust, Australian Securities and Investments Commission Chair, James Shipton, identified 6 key characteristics that financial service providers, including FinTech companies, should have to ensure that the Australian financial system is efficient, resilient and fair. Those characteristics are:
How many of these characteristics do you demonstrate?
By Dan Cohen and John ReVeal
FinCEN’s new beneficial owner rules take effect May 11, impacting banks and the program managers and similar companies that help banks comply with the Bank Secrecy Act, including FinTech companies that provide AML on-boarding and monitoring services. Under the new rules, banks and other covered financial institutions will be required to identify and verify the identity of the beneficial owners of their legal entity customers. These rules will add to your regulatory burdens, particularly over the next several weeks.
The Bank of England, the UK’s central bank, is undertaking a Proof of Concept (PoC) to understand how a renewed Real Time Gross Settlement (RTGS) service could be capable of supporting settlement in systems operating on innovative payment technologies, such as those built on Distributed Ledger Technology (DLT). It is hoped that the service will deliver a stronger, more resilient, flexible and innovative sterling settlement system for the United Kingdom to respond to the changing payments landscape. The RTGS blueprint, published in May 2017, stated that the renewed service will offer a diverse and flexible range of settlement models, to enable existing and emerging payment infrastructures to access central bank money.
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