Australian Court Dismisses ASIC Lawsuit Against Finder.com Subsidiary
Summary:
Australia's Federal Court has dismissed a lawsuit ASIC brought against a Finder.com subsidiary, Finder Wallet, declaring the financial product 'Finder Earn' compliant with laws. ASIC claims the product operated without required licenses, but the court found that Finder Earn was not a debenture under the Corporations Act. A company spokesperson declared the ruling a "landmark win," however, Finder has no current plans to reintroduce the discontinued product.
A lawsuit filed by the Australian Securities and Investments Commission (ASIC) against a subsidiary of Australian fintech firm Finder.com has been rejected by a federal court in Australia. The regulator's claim that the subsidiary's financial product, Finder Earn, did not comply with financial laws, was dismissed by Justice Brigitte Markovic on March 14. She found that the product in question did not fit the description of a debenture under the Corporations Act. A debenture is a type of debt instrument that obligates a company to pay back funds borrowed, with added interest. Justice Markovic said without proof that Finder Earn is a debenture, the allegations of contraventions of the Corporations Act were baseless. Consequently, she dismissed the case, requiring ASIC to pay costs.
In December 2022, ASIC filed a suit against Finder Wallet, a subsidiary of Finder, claiming its Finder Earn product was operating without a necessary financial services license. However, a month prior to this, Finder had already halted the product. While ASIC stated this action resulted from its communicated concerns, a representative from Finder told Cointelegraph it was a strategic business move motivated by rising interest rates, not regulatory scrutiny.
Following the court's ruling, a Finder spokesperson called the outcome a landmark victory. Despite the win, Finder has no current plans to reintroduce the Finder Earn product. They reiterated that its discontinuation was due to surging interest rates, not any regulatory action. On the day of the ruling, Finder Global CEO and co-founder, Frank Restuccia, expressed satisfaction with the judgement, underscoring Finder's regulatory compliance. He added that the firm valued and respected strict regulation to safeguard consumers and had cooperated fully with ASIC.
ASIC confirmed it considered the case important because it felt the product was being marketed without the necessary license or authorization, bypassing vital consumer protections. The regulator will now thoroughly review the court's judgement and still has the option to appeal to the Full Federal Court, made up of three judges, within a 28-day window.
This case comes just over a month after a partial victory for ASIC against cryptocurrency platform Block Earner over its yield product, Earner. In that case, it was ruled that the product required a financial services license, but the DeFi "Access" product was spared the same fate as it was determined not to fall under a managed investment scheme umbrella.
In other news, check out our Perth Crypto City Guide: A wealthy region with magnificent beaches, yet secluded.
Published At
3/14/2024 8:32:27 AM
Disclaimer: Algoine does not endorse any content or product on this page. Readers should conduct their own research before taking any actions related to the asset, company, or any information in this article and assume full responsibility for their decisions. This article should not be considered as investment advice. Our news is prepared with AI support.
Do you suspect this content may be misleading, incomplete, or inappropriate in any way, requiring modification or removal?
We appreciate your report.