Australian Federal Court to Shut Down Prospero Markets

The Australian financial landscape experienced a significant development on Thursday with the court-mandated closure of Prospero Markets, a forex and CFDs broker. This decision, led by the Australian Securities and Investments Commission (ASIC), raises concerns about Prospero's business practices and prioritizes the return of client funds.

ASIC's intervention stemmed from a series of red flags. The regulatory body suspected breaches of licensing conditions and obligations related to over-the-counter (OTC) derivatives offered by Prospero. These derivatives are complex financial instruments that can pose risks for retail investors. Prospero served both retail and wholesale clients, offering leveraged trading in forex, metals, commodities, indices, and shares.

The tipping point came in October 2023 when Australian authorities charged former Prospero officers and managers with money laundering. These charges were linked to the Changjiang Currency Exchange, involved in a $229 million money laundering scheme over three years. This raised serious concerns about the integrity of Prospero's operations.

Further exacerbating the issues, Prospero failed to submit its annual financial statements and audit reports on time. Consequently, ASIC suspended their Australian Financial Services (AFS) license in December 2023, effectively halting their operations.

The court's decision to permanently shut down Prospero underscores the severity of the situation. To safeguard client interests, ASIC has appointed liquidators – Andrew Cummins, Jonathon Keenan, and Peter Krejci from BRI Ferrier – to oversee the process of returning client funds. This prioritizes getting money back to investors who may be anxious following the string of negative developments.

While the exact number of Prospero's clients remains unknown, it is evident that they catered to both English and Chinese-speaking audiences. ASIC is actively addressing client inquiries regarding the return of their funds. This situation highlights the importance of choosing well-regulated financial institutions and the crucial role of ASIC in protecting investors. To do this efficiently, download the free WikiFX mobile application - let WikiFX handle the regulatory queries for you.