On 17 June 2020, Justice Davies of the Federal Court of Australia delivered judgment regarding pecuniary penalties, disqualification orders and injunctions in a binary options case ASIC brought against One Tech Media Ltd (OTML), Allianz Metro Pty Ltd (Allianz Metro), Eustace Senese and Yoav Ida.
The judgment follows findings made by Justice Davies in February 2020 that OTML, Allianz Metro, Mr Senese and Mr Ida had breached the Corporations Act in relation to the pressure sale of binary options to Australian consumers ().
OTML offered binary options to trading customers in Australia through websites in breach of the requirement to hold an Australian Financial Services Licence and failed to issue the necessary product disclosure statements.
Australian company Allianz Metro Pty Ltd, together with Eustace Senese and Yoav Ida, were also found to have breached the Corporations Act by providing paying agency services to OTML without an Australian Financial Services Licence. Additionally, Messrs Senese and Ida failed to issue the requisite PDS for each binary option trade conducted, in contravention of the Corporations Act.
Justice Davies noted OTML’s contravening conduct to be ‘systemic and deliberate, targeting and exploiting vulnerable people, causing them substantial long-term financial detriment through the loss of savings and superannuation used for binary options trading’, which losses were contributed to by both Mr Senese and Mr Ida.
The Court indicated it would make orders that:
- OTML be permanently restrained from carrying on a financial services business and pay a pecuniary penalty of $1.8 million;
- Allianz Metro be permanently restrained from carrying on a financial services business;
- Mr Senese be permanently disqualified from managing corporations and be permanently restrained from carrying on financial services businesses; and
- Mr Ida be disqualified from managing corporations for 15 years and restrained from carrying on financial services businesses for 15 years.
The penalties, disqualification orders and injunctions follow a judgment made by the Federal Court of Australia on 5 February 2020 in ASIC’s liability proceedings against OTML, Allianz Metro Pty Ltd, Mr Senese, Mr Ida as well as other individuals and entities seeking declarations of numerous contraventions ().