New Zealand news and information website Stuff.co.nz is reporting that the directors of now Swiss Franc shuttered FX broker Excel Markets, registered under New Zealand’s FMA as Global Brokers NZ were in violation of certain reporting laws and faced potential criminal sanction by the New Zealand Financial Services Provider Registry. It must be noted that after ceasing operations, the company did make a point to let the public know that customer funds were properly segregated, so no damage was done to clients.
The report is that information provided to the Stuff.co.nz under the Official Information Act lists Global Brokers NZ among 3,892 companies that appeared to have failed to comply with the Financial Reporting Act as of March 2013. The act required all subsidiaries of foreign companies to file audited financial statements to the registry office. Stuff.co.nz reports that Global Brokerz NZ never filed these statements. This does seem like a small deal in comparison to the reality the firm now faces being unable to carry out operations. Furthermore, although New Zealand has been making efforts to beef up it’s regulatory stature, it seems thousands of other firms were in apparent breach of this same requirement.
It’s current owners – Epicus Corporation and XT International Holdings, both registered in the British Virgin Islands – have been shareholders since October 2011. Its current managing director reported is Michael Samuel Johnson, whose registered address is in Kinsale, Ireland. Under the act, directors failing to file accounts faced infringement fees of $7,000 each, as well as fines of up to $100,000 each if prosecuted and convicted.
Irish company records list Johnson as an American, aged 35 living next door to former Global Brokers NZ director Jason Erik Peterson, also aged 35. Johnson is also listed as the manager of Project Triumph, a LLC registered in Gainesville, Florida, which is described in one of its press releases as operating several websites within the Forex industry. Peterson is described on specialist FX news site FXStreet as a co-founder of Project Triumph. Sites associated with Project Triumph, which is connected to Global Brokerz NZ (Excel Markets) directors are forexrazor.com and cashbackforex.com.
On Friday morning New Zealand time, Excel Markets told customers it had sustained a total loss of operating capital and will have to close down after an unexpected announcement from the Swiss National Bank triggered dramatic moves in EUR/CHF after lifting the currency cap.
To view the Stuff.co.nz article, click here.