The Australian Securities & Investments Commission (ASIC) has taken decisive enforcement action against Prospero Markets Pty Ltd (Prospero), an over-the-counter derivatives issuer specializing in forex and contracts for differences (CFDs).
The regulatory body has suspended Prospero’s Australian Financial Services (AFS) license due to the company’s failure to submit required financial statements and audit reports within the specified timeframe and in accordance with its AFS license conditions.
The suspension of Prospero’s license was officially announced on Friday, with an effective date of 20 December 2023.
This suspension will remain in place until 28 February 2024.
In response to this enforcement action, Prospero has committed to refraining from dealing with clients’ funds unless granted permission by the regulatory authority.
ASIC’s decision to suspend Prospero’s license followed its investigation into the company’s suspected violations dating back to 1 March 2021.
The regulator emphasized that if Prospero does not comply with the requirement to submit the necessary financial statements and reports during the suspension period, further actions such as extending the suspension or revoking the license may be considered.
On 19 December 2023, Prospero agreed to ASIC’s request to provide an undertaking that it will not engage in activities involving client funds without explicit permission from ASIC.
This undertaking is set to remain in effect until at least 8 February 2024, allowing ASIC ample time to thoroughly investigate its concerns.
Notably, Prospero is cooperating with ASIC in its ongoing investigation.
The question of whether Prospero Markets intends to appeal the regulatory decision remains unanswered at this time, as Finance Magnates’ attempts to obtain a response from the company have not yielded results as of the current press time.
Prospero Markets, as reflected on its official website, offers a range of financial products, including forex, precious metals, commodities, indices, and share CFDs.
The company initiated its Australian operations in 2012 and provides services in both English and the Chinese language, indicating a substantial Chinese-speaking client base, although specific figures are not publicly disclosed.
Additionally, ASIC has initiated actions against several other CFDs providers under its regulatory purview.
These actions predominantly stem from shortcomings related to design and distribution rules within the industry.