MIU - Issue 134 - February 2022

Former director banned for three years

We’ve banned former Radar Iron Limited and Armada Capital Pty Ltd director, Ananda Kathiravelu, of Perth, Western Australia, from providing financial services for three years, following his conviction for market manipulation offences.

Mr Kathiravelu was convicted in the Supreme Court of Western Australia in February 2021 for conspiring to manipulate the market for Radar Iron shares traded on the ASX between 12 May 2016 and 17 May 2016. He was sentenced to 12 months’ imprisonment and released on recognisance in the sum of $10,000.

In banning Mr Kathiravelu, we found that Mr Kathiravelu had not complied with financial services law and was involved in the contravention of a financial services law by another person.

The ban prevents Mr Kathiravelu from providing any financial services, performing any function involved in carrying on a financial services business and controlling an entity that carries on a financial services business.

Mr Kathiravelu has the right to appeal to the Administrative Appeals Tribunal for a review of our decision.

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Caloundra man pleads guilty to insider trading

Mr Jin Xi Li, of Caloundra, Queensland, has pleaded guilty to two insider trading offences when trading in contracts for difference (CFDs) of PanAust Limited (PanAust).

Appearing before the District Court at Brisbane, Mr Li was arraigned and pleaded guilty to one count of trading while in possession of inside information and one count of procuring his wife to trade while in possession of inside information.

Mr Li pleaded guilty to trading in CFDs of PanAust while he was in possession of inside information relating to a takeover bid for PanAust by Guangdong Rising H.K (Holding) Limited.

Prior to the announcement made by PanAust on 30 March 2015 regarding the takeover bid, Mr Li:

  • acquired 390,000 PanAust CFDs between 19 March 2015 and 26 March 2015
  • procured his wife to acquire 265,000 PanAust CFDs between 22 March 2015 and 26 March 2015.

The total profits resulting from both Mr Li and his wife’s trading was approximately $343,000.

The matter is being prosecuted by the Commonwealth Director of Public Prosecutions after a referral from ASIC. It has been listed for sentence in the Brisbane District Court on 28 February 2022.

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Consulting on revised ETP naming conventions

We’ve released Consultation Paper 356 ETP naming conventions: Updates to INFO 230 (CP 356) seeking your feedback on our proposals to simplify the naming conventions for exchange traded products (ETPs) and promote flexibility during the next phase of ETP market development.

Because ETPs have different structures, features, strategies and risks to traditional listed products, they should be labelled in a way that differentiates them from other listed products.

Key areas of focus for licensed exchanges and issuers in CP 356 include:

  • revised naming conventions divided into two levels of labelling – primary labels based on product type, and secondary labels for specific risks or strategies
  • clarification of the role of licensed exchanges authorised to admit ETPs to quotation.

Our current guidance on ETP naming conventions can be found in Information Sheet 230 Exchange traded products: Admission guidelines (INFO 230).

We welcome your feedback on CP 356 by 3 March 2022.

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Joint review with HK SFC of global groups’ FX activities

Together with the Hong Kong Securities and Futures Commission (SFC), we’ve published a circular which highlights our observations from a review of selected firms' governance arrangements and internal controls for their wholesale FX activities.

The purpose of the review, which mostly included onsite inspections of global financial groups licensed by ASIC in Australia and the SFC in Hong Kong, was to assess their compliance with local regulatory requirements in their respective jurisdiction and their adoption of other industry guidelines.

The circular highlights our observations in the areas of supervision, risk management, trade execution, last look, protection of confidential information, mark-up, post-trade surveillance, and staff personal dealing and training.

For more details of the review conducted by ASIC and the SFC respectively, refer to:

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Last updated: 25/01/2023 10:30