Australia’s Federal Court has ordered BPS Financial Pty Ltd to pay 14 million Australian dollars (around $9.3 million) for breaching financial laws through its Qoin Wallet product.
The ruling followed a case brought by the Australian Securities and Investments Commission (ASIC), which argued that the company misled users and operated without the proper license.
According to ASIC, BPS promoted the Qoin Wallet as a payment system linked to Qoin, its digital token.
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However, between January 2020 and mid-2023, the company issued and managed the product without an Australian Financial Services Licence, in violation of the Corporations Act.
ASIC Chair Joe Longo said that businesses dealing with crypto-related products must meet the same standards as other financial service providers.
He said, “Given the nature of these products, providers must have the appropriate licenses and authorisations, and investors must be able to make decisions based on clear and correct statements, especially as crypto products can be highly volatile, inherently risky and complex”.
The fine includes $1.3 million for running an unlicensed financial services business and $8 million for misleading representations.
Judge Wendy Downes said the company’s conduct was serious misconduct. She noted that senior managers were involved and that the firm had poor compliance controls.
Additionally, BPS is banned from operating any financial services business for 10 years without a license. The company must also publish official notices on its Qoin Wallet app and website explaining the court’s findings.
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