Crypto News

Australian watchdog files lawsuit against ASX over misrepresenting $165 million blockchain project

Australian watchdog files lawsuit against ASX over misrepresenting $165 million blockchain project
© Copyright Image: CryptoSlate

Australias Securities and Investments Commission (ASIC) has filed a lawsuit against the Australia Securities Exchange (ASX) Ltd., accusing it of misleading statements about its blockchain trade settlement project, according to an Aug. 14 statement.

False statements

ASIC claims the ASX falsely stated in February 2022 that its project was on track for an April 2023 launch and that it was progressing when, in reality, it was not. The regulator argued that these statements were deceptive since the project was not meeting its milestones and was ultimately canceled.

The ASXs blockchain initiative was intended to replace the Clearing House Electronic Subregister System (CHESS). However, ASIC noted that it was halted in November 2022 due to design challenges, and ASX wrote down costs of AUD250 million (over $165 million)

ASIC furthered that the project was already faltering as of February 2022, contrary to ASXs optimistic announcements. This delay and eventual cancellation resulted in substantial losses for the ASX and its market participants.

ASIC Chair Joe Longo stated that the projects failure undermined market integrity and reflected poorly on the ASX board and senior executives. He emphasized the importance of accurate information for market participants and the wide-reaching consequences of ASXs missteps.

Longo added:

Companies and market participants rely on what the ASX says about its operations to make their own decisions and investments. We expect the ASX to be a place to list and invest with confidence. When the ASX falls short, it has wide ranging consequences across the market.

ASIC revealed that the latest issues followed ASXs payment of AUD1,050,000 (over $660 million) in penalties in March due to lapses in compliance with the market integrity rules.

ASX responds

In an Aug. 14 statement, ASX CEO Helen Lofthouse said the company was reviewing ASICs allegations and recognized the significance and serious nature of these proceedings.

She added:

We play a critical role at the center of Australias financial markets and continue to focus on supporting and delivering for customers. We are committed to taking ASX forward and have made strong progress as an organization over the past two years.

ASX stated that ASIC is seeking declarations, pecuniary penalties, an adverse publicity order, and costs against it as part of the lawsuit.

The post Australian watchdog files lawsuit against ASX over misrepresenting $165 million blockchain project appeared first on CryptoSlate.

Read more: https://cryptoslate.com/australias-asic-files-lawsuit-against-asx-over-165-million-blockchain-project-misrepresentation/

Text source: CryptoSlate

Disclaimer: Financial information and news are not financial advice, read the disclaimer.
Buy & sell Crypto in minutes

Join BINANCE!

The world's largest crypto exchange

You're just steps away from receiving your reward.

The most complete Crypto News Center.

Search Stories:

Latest top stories