Forex CT ordered to pay $20m, sole director disqualified

The company’s sole director, Shlomo Yoshai, has also been fined $400,000 and disqualified from managing corporations for eight years. 

In a statement on Wednesday, ASIC said Forex – which offered clients opportunities to trade in CFDs – “engaged in a system of unconscionable conduct” including offering incentives to clients to transfer more money to their Forex trading account even after being told they could not afford to invest more money, employing high-pressure sales tactics, recommending inappropriate trading strategies and making misleading or deceptive representations to clients.

The court also found that Forex failed to act in the best interests of its clients when providing personal advice and failed to complete the necessary requirements to ensure the services were provided honestly and fairly. 

His honour Justice Middleton said the company had “systemic compliance deficiencies and a culture of non-compliance” and said that “the vast losses incurred by clients support the imposition of a significant pecuniary penalty”.

His honour also described Mr Yoshai’s behaviour as “incompetent and irresponsible”.

ASIC commissioner Cathie Armour added: “The significant penalty handed down by the Court reflects the seriousness of this conduct.

“If corporations disregard the law and their client obligations, ASIC will take action and the consequences can be severe.”

Neil Griffiths

Neil is the Deputy Editor of the wealth titles, including ifa and InvestorDaily.

Neil is also the host of the ifa show podcast.