ASIC appeals court decision to relieve Block Earner of penalty
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The news: The corporate regulator is appealing a Federal Court decision earlier this month that saw crypto startup Block Earner relieved of having to pay a financial penalty for its breach of the Corporations Act.
The context: The Australian Securities and Investments Commission (ASIC) has said Federal Court of Australia judge Ian Jackman erred in his decision to not impose a fine on the company.
ASIC said part of the reason Jackman relieved Block Earner was due to the regulator's press release in response to his initial judgment and that this was a mistake.
Jackman found in his initial judgment that Block Earner contravened the Corporations Act by offering a (since closed) fixed yield product without a financial services licence.
Lawyers for the company had asked Jackman in May to consider excusing the company from any penalty given it had not acted carelessly or caused actual harm in its conduct.
When Jackman handed down his initial decision on the court case in February, it was the first outcome on a string of cases launched by ASIC in late 2022 around whether crypto products are financial products and should be regulated as such.
What they said: "There was no evidence that anyone formed an erroneous belief based on that press release," ASIC said in its appeal to the Federal Court.
"... To impose no penalty failed to give effect to the purposes of specific and general deterrence."
The source: ASIC media release
