Forex Capital Trading Pty Ltd (Forex CT) has been ordered by the Australian Federal Court to pay a penalty of around $20 million as a result of the company having engaged in unconscionable and systemic conduct. The Federal Court alleges that Forex CT paid conflicting remuneration to some of its account managers and team leaders, and in doing so, failed to act in its clients best interests.
Alongside the significant penalty for the company, Shlomo Yoshai, the firm’s sole director, has also been ordered to pay off a $400,000 fine due to having aided the unconscionable conduct found to be operating within Forex CT. Seeing his actions as a breach of his directorial duties, Shlomo Yoshai has also been formally disqualified from leading any corporations for a duration of eight years.
It has been revealed that Forex CT made it possible for its clients to trade in margin foreign exchange contracts as well as CFDs, which were issued by the firm itself. Forex CT has been accused of unconscionable conduct due to having offered incentive-based encouragements to get clients to make significant transfers into their Forex CT trading accounts, even if they could not afford to do so.
