Australian regulators were concerned about FTX since March 2022 — 8 months before the crypto exchange collapsed, according to a report by The Guardian.
Documents obtained by Guardian Australia indicate that the Australian Securities and Investments Commission (ASIC) had issued three notices to FTX and placed the exchange under “surveillance activity” months before its collapse.
FTX was operating in the country with an Australian financial services license (AFS), which it obtained by acquiring a firm that held an AFS license. The regulators were concerned that the exchange side-stepped the scrutiny of issuing new licenses.
Therefore, the regulators issued an s912C notice to the now-defunct exchange in April 2022. ASIC asked FTX to submit information that would allow ASIC to assess whether it complied with the license conditions and if it was fit to hold the AFS license.
An ASIC spokesperson told The Guardian that the regulators were concerned about the exchange’s pricing, onboarding of users and its compliance with ASIC’s product intervention order.
FTX owes around $1 million in cryptocurrencies and cash to Australian investors. Following the bankruptcy filing in the U.S., ASIC suspended the exchange’s AFS license as the firm entered into voluntary administration in Australia.
ASIC is currently investigating FTX for “suspected contraventions of the corporation’s legislation,” as per the report.