Receivers of BlackfortFX say company “not actually traded in foreign exchange”

KordaMentha, the company that was appointed as a receiver and manager of the assets of BlackfortFX/Arena Capital Limited, has published its first update to clients of the New Zealand-based retail Forex broker. The company, as you may recall, was placed under control of KordaMentha a couple of weeks ago amid concerns that the business was operating in violation of New Zealand’s laws and that the client funds were in danger.

Let’s look at some of the key points that the update provides.

  • The receivers have not found any evidence that BlackfortFX (Arena) was active in the FX industry. Their exact words are: At this stage, despite what you may have been advised, we do not believe clients have earned any profit because we do not think Arena has actually traded in foreign exchange.
  • Some people have alleged that Arena was using the platform of Dukascopy Bank to offer FX services, but Dukascopy Bank has confirmed that Arena does not have (and never had) any account with it.
  • So far, 750 people have contacted KordaMentha, claiming to have deposited funds with the broker.
  • The total sum deposited by clients and partners of the broker into Arena Capital bank accounts is approximately NZ$9 million (US$6.3 million). The administrators say some of the sum, however, was returned to several clients before the company was placed into receivership.
  • KordaMentha notifies all clients that if they have received money from Arena they may, in certain circumstances, be required to repay that money.
  • Soon after being appointed, the receivers have secured the assets of Arena. The bank account holds approximately NZ$730,000. KordaMentha have also taken possession of three luxury vehicles held in the name of Arena. The receivers are also pursuing some other minor potential assets.

The receivers voice their understanding of the fact that clients of the broker wished to get their money soon, but warned that the client funds’ recovery would be a cumbersome process. At this point, KordaMentha say BlackfortFX/Arena should not be released from receivership.

To view the full text of the update from KordaMentha, click here.

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