Former directors of XTrade.AU Pty Ltd banned – July 18, 2024
Shay Zakhaim and Anthony Anderson, former directors and responsible managers of XTrade.AU Pty Ltd, have been banned from carrying on a financial services business for three and five years respectively.
The company’s AFS license was earlier cancelled after a failure to comply with financial services laws from June 2018 to September 2022, and engagin in unconscionable conduct.
As directors and responsible managers, Anderson and Zakhaim were found to be involved in XTrade’s failure to:
- have proper arrangements to manage conflicts of interest, which instead encouraged aggressive sales tactics by XTrade’s representatives towards clients; and
- make sure its representatives complied with financial services laws until at least February 2022, including letting them use unfair tactics to tempt clients to deposit and trade with more funds than they initially set out to.
Aleksandra Frizzell banned following fraud convictions – July 18, 2024
The former Sydney-based mortgage broker Aleksandra Frizzell has been permanently banned from working within financial credit industries after fraud convictions.
Frizzell was accredited with Beagle Finance Pty Ltd 2013-2017, and Supra Financial Pty Ltd 2017-2018, and was found to have dishonestly obtained funds from an employee, clients, and people purchasing goods on Facebook Marketplace.
She was convicted of 17 counts of dishonestly obtaining a financial advantage by deception, three counts of dealing with identity information to commit an indictable offence, and one count of dishonestly obtaining property by deception. She was sentenced to four years’ imprisonment.
Former adviser Anass Abdalla banned – July 17, 2024
The Queensland based financial adviser Anass “Caesar’ Abdalla has been permanently banned from providing any services or performing in any function of a financial services business due to lacking the fitness and propriety to do so.
As the general manager of a financial services licensee, Abdalla asked an authorized representative – who was not working at the time – to sign documents which mislead clients into believing that personal advice had been given by an authorized person when it had not.
Court updates
American Express to pay A$8m penalty – July 19, 2024
American Express Australia Limited (Amex) has been ordered to pay A$8m in penalties for breaching the design and distribution obligations (DDO) relating to two co-branded credit cards which were primarily distributed to customers in David Jones stores.
The Federal Court found Amex had breached the DDO as a credit card issuer when it, between May 25 to July 5, 2022:
- should have known that high cancelled application rates would have demonstrated that the cards’ target market determinations (TMDs) were no longer appropriate; and
- failed to stop issuing the cards when it had not reviewed the TMDs.
It was also found that those responsible for monitoring the TMDs were not aware of their obligations, and those who were aware failed to take action.
Amex admitted to the contraventions, and jointly submitted the penalties sought by ASIC were appropriate. It will also pay ASIC’s cost of the proceedings.
“A penalty of this order ensures it has a ‘sting’ sufficient to deter both repetition by American Express and contravention by other providers of financial products.”
Justice Jackman
Former BitConnect promoter John Bigatton convicted – July 15, 2024
John Bigatton, the former Australian promoter of BitConnect, has been convicted of providing unlicensed financial advice, breaching s911B(1) of the Corporations Act 2001, which he pleaded guilty to in May.
Bigratton was found providing unlicensed and unauthorized financial advice when he promoted the crypto token bitConnect in seminars and on social media between August 2017 and January 2018.
The Sydney District Court released him on condition of good behavior for three years. In September 2020, he was also banned from providing financial services for seven years.
“People who get involved in the promotion of financial products as part of a business for profit … need to be scrupulous in finding out for themselves what the law is and then to abide by that law.”
The Sydney District Court
ASIC news week 29
Australian banks to pay back A$28m to low-income customers
Following a review from ASIC, customers on low incomes, including First Nations customers, will be repaid over A$28m ($18.9m) from four major banks after findings that the they systemically charged high fees to those customers that could least afford it.
Read the full GRIP article here.