ASIC Revokes Interim Stop Order against CFDs Broker Mitrade

<p>The Australian Securities and Investments Commission (ASIC) revoked the interim stop order against Mitrade Global Pty Ltd, a contracts for differences (CFDs) broker, on 26 July. The regulatory <a href="https://www.financemagnates.com/forex/asic-flags-mitrade-global-for-ddo-violations-suspends-operations/">initially imposed the interim stop order</a> against the broker on 22 June due to design and distribution obligations (DDO) violations.
</p><p>Mitrade Complies with ASIC’s Rules
</p><p>“Following the interim stop order made on 22 June 2023, Mitrade addressed ASIC’s concerns regarding its failure to take reasonable steps likely to result in distribution conduct being consistent with its TMD (target market determination). ASIC revoked the stop order on 26 July 2023,” an update from the Aussie regulator noted.
</p><p>In Australia, Mitrade operates with an Australia Financial Services (AFS) license and offers CFDs of forex, indices, commodities, and shares to retail investors and traders. Apart from the AFS license, Mitrade also provides its services globally with authorization from regulators in the Cayman Islands and Mauritius. The broker <a href="https://www.globenewswire.com/en/news-release/2023/01/12/2587613/0/en/Mitrade-Hits-2-4-Million-Users-Up-900-000-from-Last-Year.html">added about 900,000 new users last year</a>, taking the total count of clients to 2.4 million.
</p><p>ASIC’s Strict Rules around Target Market
</p><p>According to the <a href="https://www.financemagnates.com/tag/asic/">ASIC’s </a>original order, there were lapses in Mitrade’s <a href="https://www.financemagnates.com/forex/aussie-firms-should-meet-design-and-distribution-obligations-asic/">target market determination</a> (TMD) with flaws in the “retain investor questionnaire.”
</p><p>“<a href="https://www.financemagnates.com/tag/mitrade/">Mitrade </a>questionnaires gave prompts to a prospective retail investor to review any ‘unacceptable answer’ that would indicate that the investor was not likely to be in the target market for the products,” ASIC stated in its original interim stop order in June, adding that the broker even allowed retail investors unlimited attempts to pass the questionnaires.
</p><p>With the interim order, the Aussie regulator prevented the broker from opening trading accounts and dealings in CFDs and margin forex to retail investors and only allowed “varying or closing their CFD positions.”
</p><p>A Mitrade representative told <a href="https://www.financemagnates.com/">Finance Magnates</a>: “Over the past few weeks, our team has been working diligently to address ASIC’s concerns, and we are pleased to share that the interim stop order imposed by ASIC has been officially lifted.”
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This article was written by Arnab Shome at www.financemagnates.com.