Finder Wallet sued over alleged improper license

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ASIC Vice President Sarah Court says the civil proceeding is the third recent action by regulators against a company offering a crypto-asset-related product considered a financial product, including a lawsuit against the fintech company Block Earner for allegedly providing unlicensed financial services, and BPS Financial for making misleading claims regarding its crypto-asset, Qoin.

Our message to the industry is clear, just because an offering involves a crypto-asset related product does not guarantee it will fall outside the current regulatory regime, she said.

ASIC also alleged that Finder Wallet did not hold an Australian Financial Services License, a requirement for firms providing financial product advice or trading financial products when offering Finder Earn, potentially putting their customers at risk, for example by offering them a product that was not suitable for them.

A spokesperson for Finder said the company has proactively engaged with ASIC and fully cooperated with all requests for information. However, the company will defend the procedure.

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We do not share ASIC’s view that Finder Earn can be considered a debenture, a Finder spokesperson said. An innovative product, Finder Earn offered customers a way to earn returns on their crypto. All client capital has been fully repaid and product was withdrawn last month.

ASIC seeks monetary penalties from monetary fines imposed and collected by civil courts and court pronouncements. The date for the first hearing has not yet been set.

The Australian Financial Review reported that Finder held $17.3 million in member holdings and $2.2 million in member holdings in digital assets, according to company filings from June this year. He also reported that the company claims to have paid around $500,000 to Finder Earn customers before the crypto products shut down.

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