Today brought another development in the case of Arena Capital Limited, trading as BlackfortFX. The company, which was placed in receivership in the end of May 2015, was de-registered from the list of New Zealand’s Financial Service Providers (FSP).
The Registrar said the de-registration was done under section 18(1) of the Financial Service Providers (Registration and Dispute Resolution) Act 2008, which states that:
The Registrar must deregister a financial service provider after a notice period in accordance with sections 19 and 20, if the Registrar is satisfied that the provider—
(a) is no longer qualified to be registered in accordance with section 13; or
(aa) has failed to notify the Registrar of the name, business address, and membership number, as required by section 16(1)(ab); or
(b) is not in the business of providing a financial service (at any time after the expiry of 3 months after registration); or
(c) has been registered because of a false or misleading representation or omission; or
(d) has proffered an application fee or annual confirmation fee or levy that has subsequently been dishonoured, declined, or reversed.
The investigation into the company continues, as receivers from KordaMentha have found no evidence that Arena/BlackfortFX ever actually traded in foreign exchange. This is a sad piece of news for investors as this means none of their “profits” was legally obtained, and that many of them will have to return the money they were given by the company.
So far, 750 people have contacted BlackfortFX’s receivers, claiming to have deposited funds with the broker. The total sum deposited by clients and partners of the broker into its bank accounts is approximately NZ$9 million (US$6.3 million). Only a small proportion of this sum has been recovered by KordaMentha.
To view the administrators’ updates on the case of Arena Capital (BlackFortFX), click here.