NGS Crypto in happier times

NGS Crypto Pty Ltd, an Australian digital asset investment firm based in Sydney, and two of its senior executives, Brett Mendham and Ryan Brown, have faced civil penalty proceedings from the Australian Securities and Investments Commission (ASIC) for alleged breaches of financial services laws. The announcement was made by ASIC on March 23, 2023.

According to ASIC's statement, NGS Crypto and its executives have been accused of providing financial services without holding an Australian Financial Services License (AFSL) or an appropriate exemption. The company reportedly offered digital asset investment services to retail clients, which constitutes a financial service under Australian law.

ASIC's investigation began in late 2022 when it identified potential non-compliance with financial services regulations. The regulator issued a formal warning to NGS Crypto in January 2023, but the company continued to provide services without obtaining the necessary license or exemption.

Brett Mendham is the founder and CEO of NGS Crypto, while Ryan Brown is the company's head of trading. Both executives have been named as respondents in the civil penalty proceedings.

ASIC's statement emphasized that providing financial services without a valid license is a serious matter that can result in significant penalties for individuals and companies involved. The regulator is seeking penalties, costs, and banning orders against NGS Crypto and its executives for their alleged non-compliance.

NGS Crypto's website currently displays a notice stating that the company is cooperating with ASIC's investigation and that it is unable to provide any investment services until the matter is resolved. The notice also advises clients to seek advice from their legal or financial advisors regarding their investments with the company.

This is not the first time that ASIC has taken action against unlicensed digital asset investment firms in Australia. In recent years, the regulator has stepped up its efforts to enforce financial services laws in the rapidly evolving digital asset industry.

ASIC's investigation into NGS Crypto is ongoing, and it is unclear at this stage what penalties, if any, will be imposed on the company and its executives. The outcome of the proceedings will likely set an important precedent for other digital asset investment firms operating in Australia.

In response to ASIC's announcement, NGS Crypto issued a statement expressing its commitment to cooperating fully with the regulator and to resolving the matter as soon as possible. The company also emphasized that it takes its regulatory obligations seriously and is working to obtain the necessary license or exemption to continue providing digital asset investment services to clients.

In conclusion, NGS Crypto, an Australian digital asset investment firm, and two of its executives, Brett Mendham and Ryan Brown, have faced civil penalty proceedings from ASIC for alleged breaches of financial services laws related to providing digital asset investment services without a valid license or exemption. The investigation is ongoing, and penalties, if imposed, could be significant for both the company and its executives. ASIC's action underscores the importance of regulatory compliance in the digital asset industry.