Australian Securities and Investments Commission v BPS Financial Pty Ltd

The case between the Australian Securities and Investments Commission (ASIC) and BPS Financial Pty Ltd (BPS) involved a dispute concerning the legality of BPS's operations in relation to the Qoin Project, a digital currency initiative. BPS, a member of the Bartercard Group, intended to implement the Qoin Project, which involved transitioning the Trade Dollar concept to a digital currency. ASIC alleged that BPS contravened certain sections of the Corporations Act 2001 (Cth) and the Australian Securities and Investments Commission Act 2001 (Cth). Specifically, ASIC contended that BPS carried on a financial services business without holding an Australian Financial Services Licence (AFSL), and that BPS made misleading statements regarding the approval and registration of the Qoin Non-Cash Payment (NCP) Product.

The primary legal issues before the court were whether BPS was an authorised representative under the Corporations Act and whether BPS's statements about the Qoin NCP Product were misleading or deceptive. The court had to determine if BPS was authorised to issue financial products under the Corporations Act, and if its statements about the approval and registration of the Qoin NCP Product contravened the ASIC Act. The court examined the relevant provisions of the Corporations Act and the ASIC Act, including sections 761A, 910A, 911A, and 916A of the Corporations Act, and sections 12DA and 12DB of the ASIC Act.

The court found that BPS did not hold an AFSL when it issued the Qoin NCP Product and provided financial product advice, thereby contravening sections 911A(1) and 911A(5B) of the Corporations Act. However, during the period when BPS was an authorised representative of another AFSL holder, it was exempt from the requirement to hold an AFSL under section 911A(2)(a) of the Corporations Act. Additionally, the court held that BPS contravened sections 12DA(1) and 12DB of the ASIC Act by making misleading statements about the approval and registration of the Qoin NCP Product. These statements were found to be false or misleading, as they implied official governmental approval or registration, which did not exist. BPS's contention that the statements were merely opinions or concerns about compliance with the Corporations Act was rejected by the court.

The court ordered the parties to confer and agree upon a form of order reflecting the judgment and directions for the proceeding's further conduct by a specified date. If the parties could not agree, they were required to submit their proposed drafts and written submissions to the court.