On Apr. 12, AST ASIC said it took action re blockchain mining firms.
AST ASIC said it started civil proceedings against blockchain mining firms NGS Crypto Pty Ltd, NGS Digital Pty Ltd, NGS Group Ltd (NGS firms) and the sole directors of those respective firms, Brett Mendham, Ryan Brown, Mark Ten Caten, for alleged fails.
Follows AST ASIC Mar. 2024 gave speech on crypto policy, regulation, see #205485.
Orders
AST ASIC said AST Court made orders, on Apr. 10, 2024, appointing receivers over the digital currency assets of NGS firms, and of Mendham, Caten, and Brown.
Receivers appointed on basis of concerns digital assets of investors, which are invested in the blockchain mining products offered by NGS firms, are at risk of dissipation.
AST Court also made orders restraining Mendham from travelling outside of Australia.
Allegations
Alleged NGS firms target Australian investors to invest in blockchain mining packages with fixed-rate returns, encouraging them to use funds transferred from regulated super funds to self-managed super funds (SMSFs) and then converted into crypto.
AST ASIC's preliminary investigations indicate over 450 Australians invested approximately USD 41mn via NGS firms; alleged NGS firms in breach of ASTCA.
By providing financial services without an Australian financial services license (AFSL).
As part of proceedings AST ASIC is also seeking interim as well as final injunctions.
Specifically, against NGS firms preventing them from providing financial services in Australia without AFSL; these proceedings should send a message to crypto industry.
A message that products will continue to be scrutinized by AST ASIC in order to ensure that they comply with regulatory obligations in order to protect consumers.
Next Steps
AST ASIC said a return date has not been scheduled for the proceeding at this stage.
