By: Daniel Knight, Simon Kiburg and Ben Kneebush
The Australian Securities and Investments Commission (ASIC) recently released proposed updates to Information Sheet 225 (INFO 225) and a corresponding consultation paper.
Read MoreBy: Daniel Knight, Ben Kneebush and Madison Jeffreys
As Artificial intelligence (AI) continues to be adopted and used by Australian Financial Services (AFS) licensees broadly, there is a risk that the deployment of AI might cause licensees to fall short of their existing regulatory obligations and emerging best practices.
Read MoreBy: Daniel Knight and Ben Kneebush
On 4 June 2024, the latest chapter in ASIC’s crypto-asset enforcement efforts unfolded with the Federal Court relieving Block Earner from liability to pay penalties in connection with providing unlicensed financial services (ASIC’s media release can be found here).
Read MoreBy Daniel Knight and Hugo Chow
All holders of an Australian Financial Services License (AFSL) with a retail client authorisation will need to comply with ASIC’s internal dispute resolution (IDR) reporting framework. Summary reports will need to be provided to ASIC on a 6 monthly basis, highlighting the status of each client complaint. Reporting obligations commence from 1 July 2023 (for reporting in January or February 2024). AFSL holders should put systems in place now to ensure all required information is being captured.
Read MoreBy Daniel Knight and Oliver Herrmann
New licensing requirements for crypto service providers are coming, following a series of consultations launched last week by Treasurer, Jim Chalmers. The Government approach focuses on strengthening enforcement, bolstering consumer protection and ultimately establishing a new licensing framework.
Read MoreBy Daniel Knight and Kithmin Ranamukhaarachchi
In the wake of the drawn out cryptocurrency market downturn, increased regulation of the sector seems inevitable. With nearly one million Australians transacting in cryptocurrencies last year, there have been widespread calls to enact additional protections for retail investors.
Read MoreBy Jim Bulling and Edwin Tan
On 30 May 2019, the Australian Securities and Investments Commission (ASIC) updated its Information Sheet 225 which sets out guidance for entities that are looking to raise funds through initial coin offerings (ICOs) or are otherwise involved with crypto-assets. Interestingly, ASIC has grouped crypto-asset participants into several distinct categories and has broadly set out the obligations that may apply to participants in each category.
Particular aspects of the information sheet that may be of interest to crypto-asset participants include:
In summary, while ASIC’s updated Information Sheet does not break any new ground in relation to the regulation of crypto-assets in Australia, it serves as a useful resource for any entity that is looking to be involved as a crypto-asset participant. We remind our readers there are many avenues to market for token issuers, even where their tokens constitute financial products, and it may be useful to seek legal advice in this regard. For example, tokens that only constitute securities can be offered to sophisticated investors without attracting significant disclosure obligations including the provision of a prospectus.
By Jim Bulling, Felix Charlesworth and Andrew Fay
On 30 April 2019, Australian Securities Exchange (ASX) released the first of seven “drops” of software code into the “Customer Development Environment”. This marks the beginning of the introduction of the new equities clearing and settlement system, which ASX is developing to replace the existing CHESS system. The new system is based on distributed ledger technology (DLT) and promises to provide customers with access to real-time, synchronised, source-of-truth data.
Read MoreBy Jim Bulling and Andrew Fay
In January 2019, Canada’s largest cryptocurrency exchange, QuadrigaCX, announced that it had lost $180 million of virtual currency, prompting calls for tighter regulatory oversight of the industry.
Canada is home to 18 publicly listed cryptocurrency companies, more than any other jurisdiction in the world. This puts Canada at the heart of the issue, and has also put the Canadian Public Accountability Board (CPAB) on notice. The CPAB, which regulates auditors, has confirmed that it has been reviewing how existing Canadian audit standards apply to the cryptocurrency industry. Canada, like Australia, subscribes to the International Financial Reporting Standards.
Read MoreBy Jim Bulling, Felix Charlesworth and Andrew Fay
In December 2018, the US Securities and Exchange Commission (SEC) settled an enforcement action with Wealthfront, one of the industry’s leading robo advisors. This came after Wealthfront made false statements about its software’s ability to implement a ‘tax-loss harvesting’ strategy. Wealthfront failed to properly execute the strategy, resulting in losses to a significant number of clients. Wealthfront ultimately agreed to pay a $US 250,000 penalty.
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