Crypto player Helio Lending hit with ASIC charges over credit licence claims
ASIC has accused Melbourne-based cryptocurrency lender Helio Lending of falsely claiming it held an Australian credit licence.
The corporate regulator is alleging Melbourne-based cryptocurrency player Helio Lending repeatedly represented to its customers it held an Australian credit licence when it did not.
The Australian Securities and Investments Commission smacked the Australian subsidiary of American-listed group Cyios Corporation with charges which could see Helio Lending facing stiff penalties.
Helio Lending is set to face Melbourne Magistrates’ Court on July 7. The company has not yet commented on the charges.
ASIC alleges Helio Lending wrongly displayed on its website “around 20 February 2019” that it held an Australian credit licence.
The regulator also alleges Helio Lending also allowed to be published on its website an article from September 2018 that wrongly claimed it held a credit licence.
The charges come after an initial buzz around Helio which repeatedly touted it held an Australian credit licence in the media.
Business Insider even quoted in December 2018 the company’s licence number as #3391330, noting Helio’s head of business development Max Geraldes’ claim that the licence was obtained by the buyout of Cashflow Investment.
However, ASIC is understood to have alleged that Helio Lending did not hold a licence nor did it act as a representative of Cashflow Investment or any other licence holder.
Helio Lending offered to supply customers loans in US dollars, euros, Australian dollars, or Hong Kong dollars if handed Bitcoin, Ethereum, Litecoin or Ripple.
Helio Lending offers loans on rates “as low as 4 per cent” from six lenders.
The legal trouble comes despite Helio Lending touting its “brilliant mix of financial services background” working with the business.
“Combined, the team holds over 100 years of expertise in the financial services and technology industries,” the company has said.
Helio Lending, which offered its customers loans backed by cryptocurrency assets, using the digital currency as security over the loan, was given the charges on Friday.
The ASIC action against Helio Lending comes as the corporate regulator shapes up against the broader sector.
ASIC commissioner Cathy Armour recently detailed the regulatory vision for crypto assets, noting consultation in process with Treasury around policy in the space.
Ms Armour noted ASIC had issued several alerts of crypto scams to consumers.
The current regulatory model offers tailored licensing for crypto-asset service providers alongside the existing Australian Financial Services and marketing licensing regime.
Helio Lending co-founder Don Christie declined to comment on the legal charges facing the business.
Mr Christie runs Melbourne based law firm Astuto Lawyers.
Helio Lending’s legal and cryptocurrency adviser, Piper Alderman partner Michael Bacina, did not respond to request for comment.
Helio Lending managing director and founder John O’Shea did not respond to requests for comment.
However, Mr O’Shea also chairs NASDAQ-listed Cyios Corporation, which owns Helio Lending and holds stakes in several other businesses in the group.
These include Helio Exchange, which offers trades across more than 45 different cryptocurrencies and 19 foreign exchange currencies. Helio Exchange is not caught up in ASIC’s charges.
Cyios also controls Immortals Group, which touts its focus on designing, producing, marketing and selling super-hero non fungible tokens as well as developing gamified NFTs.
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