ASIC Banned the Director of JB Markets

The Australian Securities and Investments Commission (ASIC) has banned Peter Aardoom, the director of JB Markets, for eight years from associating with any financial services firm. This ban follows a series of regulatory actions against JB Markets, which included the cancellation of its Australian Financial Services (AFS) license less than a year ago.

Misrepresentation of Investment as Loan

The ASIC investigation revealed that Aardoom, who had been with JB Markets since 2016, was responsible for misrepresenting an equities investment as a loan. In 2021, JB Markets received AU$540,000 from another company, which was categorized as a loan in the official documents. However, the transaction was intended to be an equity investment in JB Markets.

The misleading transaction was used as part of a restructuring plan for JB Markets, with Aardoom reducing the loan value to ensure that the companys total liabilities remained below AU$ 1 million. This was a critical factor in the approval process for the restructuring plan, which would have allowed JB Markets to avoid further financial scrutiny and continue operations under its AFS license.

ASICs Findings and the Consequences for Aardoom

ASICs investigation concluded that Aardoom had engaged in fraudulent behavior by not issuing shares to the unnamed company promptly, despite the equity investment being disguised as a loan. As a result, ASIC determined that Aardoom was not a fit and proper person to participate in the financial services industry.

The regulator‘s decision was clear: Aardoom’s actions were likely to contravene financial services laws, demonstrating his unsuitability to be involved in the sector. The eight-year ban bars Aardoom from controlling any financial services entity or performing any financial services-related function for the duration of the sanction.

Continued Regulatory Action Against JB Markets

This ban comes as part of a broader set of actions against JB Markets, a brokerage firm that offered trading in forex, CFDs, and a variety of other products. ASIC had already taken steps to suspend the firm‘s AFS license in November 2023, citing concerns about the company’s failure to meet the financial requirements set forth under the license. By April 2024, the suspension became permanent, resulting in the full cancellation of JB Markets license.

At the time of its license cancellation, JB Markets was also under investigation for its failure to maintain the necessary resources to provide its advertised financial services. ASIC‘s actions underscored the broker’s inability to comply with regulatory standards, putting the safety of traders at risk.

JB Markets Low Rating on WikiFX

As a result of its regulatory troubles and ongoing legal issues, JB Markets has received a low score of 1.54/10 on WikiFX, a leading platform for broker ratings. This score highlights the concerns many traders have had regarding the companys practices, particularly in light of its unregulated operations and questionable management decisions.

Conclusion

ASIC‘s actions against Peter Aardoom and JB Markets send a strong message to the financial services industry: misrepresentation and non-compliance with regulatory standards will not be tolerated. Aardoom’s eight-year ban serves as a warning to others in the industry that such behavior can have serious, long-lasting consequences.

For traders, this case highlights the importance of conducting thorough due diligence before choosing a broker. Investing with an unregulated firm or one with a questionable track record can expose you to unnecessary risks. ASICs regulatory actions are a reminder of the critical role that oversight plays in safeguarding traders' interests.