Audits and checks of holders seem to be random, and so long as the appropriate forms are filled and no flags are raised, there appears to be no restraint on how you use the license.INVESTORS banking on the accuracy of the corporate watchdog’s register of financial services licence holders to work out whom they should trust with their money, might want to reconsider.
Insider tried yesterday to get an answer to whether (a) the Australian Securities and Investments Commission does regular checks of its licence holders, and (b) if the licence is ”attached” to the company to which it is issued, or the person controlling the company.
The official response was a link to an ASIC website, and a copy of its regulatory guide to financial service licences, both of which raised more questions than answers.
Audits and checks of holders seem to be random, and so long as the appropriate forms are filed and no flags are raised, there appears to be no restraint on how you use the licence once it is granted.
That probably explains the emails and phone messages Insider received over the weekend after last Friday’s column on the mysteries of Republica Capital, and its attempt to inject itself into the hollowed-out ASX listing of MediVac.
According to ASIC’s professional registers, Republica is an authorised representative of a derivatives trading company called Alt-FX. That same company has also authorised Beauchamp Securities to trade under its licence.
ASIC’s register of licensees, available so investors can check the bona fides of people offering to invest their money, says that Alt-FX operates from the offices of E.Vo Global Asset Management in Sydney, and is audited by Peter White. According to E.Vo director Jacob Pope, who rang Insider from Canada, that company has not had anything to do with Alt-FX, and its then controller Andrew Howard, for the past four years.
At any rate, ASIC company records, as distinct from the licence register, show that Howard passed control of Alt-FX to fellow director, Kieran Honour, last November, who then shifted its official digs to his home in suburban Prahran before giving it a shingle in Collins Street.
Honour is named on Republica Capital’s website as its chairman, so it was presumably a pretty simple matter, as the owner of Alt-FX, to authorise Republica to be its representative. Beauchamp shares the same Collins Street address as Alt-FX, and its director Trent McKendrick also sits on the board of Alt-FX.
The last time Alt-FX lodged a set of accounts with ASIC was in July 2010 – and they were already more than 12 months old. Honour signed them, with banker Albert Verdicchio, and they showed the company had a grand turnover of less than $60,000 and net assets of less than $75,000.
They also claimed that the company’s principal activity was acting as investment adviser to Alt-FX SPC, based in the Cayman Islands – which is interesting because Insider has seen records that say the Cayman company was struck off in October 2009. Presumably Alt-FX must have found something else to do so its directors could make the statement that nothing had happened since the end of the financial year that would significantly affect operations.
Last week, Honour, as shareholder/director, filed a copy of a letter sent to himself as company secretary to convene a meeting to have Alt-FX’s auditor, Peter White, removed. The letter was dated April 20, which brings a new meaning to snail mail.
Insider wonders just what use ASIC’s register of licence holders is if Alt-FX is an example of how outdated the information can be.
How many people are giving their hard-earned money over to licence holders on the naive assumption that those operating under a licence have been vetted by ASIC within living memory?
Symex comes up short
SYMEX Holdings appears to have been unable to meet an $11 million debt repayment obligation due by June 30, judging by its call for a halt to share trading yesterday.
The troubled consumer goods and tallow trader has been trying to offload non-core assets to generate cash to cut its borrowings. It recently sold its DCS International offshoot, having written off more than $4 million of associated goodwill in the half-year result, and had been aiming to sell non-core properties by the end of financial year to help meet the bank loan repayment.
Symex has had plenty of time before yesterday to alert the market to its attempts to get its repayment terms extended before the deadline, and the ASX should be asking if those buying and selling its shares in recent times were trading in a fully informed market.
This story Administrator ready to work first appeared on Nanjing Night Net.