The US brokerage house Interactive Brokers has been informed by The Australian Securities & Investments Commission (ASIC) that it has to stop with OTC currency financial services providing for Australia’s clients.
Moreover, Interactive Brokers is still monitored by ASIC due to the Corporations Act, if the company did not breach any of its provisions, as Miriam Phillips, ASIC media spokeswoman informed Bloomberg via e-mail. “ASIC has requested Interactive Brokers to cease providing all over-the-counter FX services in Australia, and has requested the provision of further information to enable ASIC to decide on an acceptable orderly exit mechanism from that business in Australia.” Phillips added.
ASIC has already expressed his will last year, favouring Interactive Brokers to establish an absolutely new legal entity in Australia for providing financial services. The company thus should get new licesnse, go through registration process with appropriate checking of the management, etc., what could bring additional costs for the group. The Interactive Brokers work on Australian field since 2013 as as Phillips stated, ASIC remained inactive expecting that the company would get Australian license. Nevertheless, ASIC informed on Wednesday that Interactive Brokers won’t get the license after changing its inactive position last week.
Problems of the US-based broker started even in 2013 when the company informed its Australian clients that it is unable to increase their margin loans, popular in traders’ community. According to official statement of the Interactive Brokers, the reason was strict Australia’s regulation on credit provision since 2010 and ASIC informed that Interactive brokers’ AFS license do not cover maring lending business.
Before ASIC asked Interactive Brokers only for filling the original AFS license, what met expectations of the US-based broker, nevertheless ASIC subsequently moved further and is asking for a new entity since last year, what the broker, as it seems, did not expect before and is trying to avoid.
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