The business was likely to materially contravene its licensee obligations, the authority says
The Financial Markets Authority (FMA) has suspended the crowdfunding provider licence of The Property Crowd (TPC) for failing to comply with its licensee obligations.
FMA said TPC had financial reporting failures, been deregistered from the Financial Service Providers Register (FSPR) and had ongoing compliance issues. The breaches included filing certain financial reports late, failing to file its annual return, and failing to provide FMA with sufficient information about how TPC will improve its systems, processes, and documentation to prevent further issues.
TPC was granted its licence by FMA on Oct. 18, 2018; but has since then not hosted a successful offer and has no investors currently use its platform. A $75 stake in the company was acquired by Singapore-based Property Strata in January 2021, however, who signalled an intention to relaunch its service.
“Ongoing non-compliance shows TPC has a poor understanding of its regulatory obligations and the ongoing lack of information from TPC hinders the FMA from effectively carrying out our supervisory functions,” said Paul Gregory, FMA Acting Director of Capital Markets. “So, investors cannot make informed decisions about whether to invest on TPC’s platform and their money could be at risk.
“Suspending a licence is a significant step which should be considered carefully. But we concluded it was the appropriate response to TPC’s overall pattern of compliance issues, while giving TPC the opportunity to demonstrate effective compliance and re-enter the market.”
TPC has provided FMA with a preliminary remediation action plan for improving compliance. That will be worked through with the authority before any relaunch.
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