A trading platform with links to companies raided by the AFP last week has had its accounts frozen

Prospero Markets, which has links to the companies at the heart of the AFP’s major money laundering swoop last week, has had its bank accounts frozen.

Police executing a search warrant at Changjiang Currency Exchange in the Sydney CBD conducted as part of Operation Avarus-Nightwolf.

Forex and CFD trading platform Prospero Markets, which is linked to the Changjiang Currency Exchange which was raided by the Australian Federal Police last week leading to several arrests, has told its clients that its bank accounts have been frozen and it will soon lose the ability to function.

The AFP swooped last week, with more than 240 AFP members and 92 specialist members executing 20 search warrants across every mainland state, and restraining more than $50m in property and vehicles as part of Operation Avarus-Nightwolf.

The AFP is alleging that the Changjiang Currency Exchange, which operates currency remittance storefronts across the nation, was being secretly run by the Long River money laundering syndicate, which it says has laundered almost $229m of proceeds of crime over the past three years.

Four Chinese nationals and three Australian citizens have been charged for their alleged involvement in the money laundering syndicate, and remain in custody after facing court in Melbourne last week.

Australian Federal Police officers taking part in the raids last week.

The Prospero platform had its bank accounts frozen on the same day the AFP executed its raids, communication sighted by The Australian indicates, however the police are not confirming a link between the organisations. While the Australian is not suggesting any wrongdoing on behalf of Prospero, our investigations have established the link exists.

Prospero, based in Box Hill, Victoria, is an online platform offering trading in financial instruments including foreign exchange, commodity and indices trading, as well as potentially risky contracts for difference which can be highly leveraged.

The platform is understood to focus on serving Australia’s Chinese community, with the website also offered in Chinese and its current and former directors largely hailing from China originally.

An email to clients sighted by The Australian says “We regret to inform you that Prospero Markets’ bank accounts including but not limited to its Client Money bank accounts have been frozen by the banks’’.

“We are in the process of contacting the relevant banks to have these accounts unfrozen.

“As a result, we have been unable to process your deposits and withdrawals, as well as other required dealings in these accounts, since October 25.

“We are working to rectify this as quickly as possible.’’

The AFP operation occurred on October 25.

The AFP was asked By The Australian to confirm a link between Prospero and Changjiang but said only: “As part of the recent Taskforce Avarus Operation Nightwolf overt activity, the AFP-led Criminal Assets Confiscation Taskforce has not restrained any assets from Prospero Markets or Changjiang businesses’’.

The Australian’s investigations show that a former director of Prospero, Chen Xin Sheng, 67, and Chen Zhou, 37, of Balwyn, who was arrested at the family’s $10m mansion last week, have in the past listed the same address as their residence.

Mr Chen, 37, lists several former companies with the corporate regulator as being registered at a property in Templestowe, Victoria, which Xin Sheng Chen lists as their residence when they were a director of Prospero, for a brief period from March-June in 2021.

Chen Zhou, 37, and Lu Jie, 28, are led away from a property in Balwyn.

The younger Mr Chen was last week charged with two counts of conspiring to deal and engage in conduct with the proceeds of general crime, valued at $10m or more.

The property where Mr Chen was residing, a $10m mansion in Balwyn, has been seized by police.

Records sourced from the Australian Securities and Investments Commission show that the former ultimate holding company of Prospero was CJ Prime Financial, which had as its sole director Ding Wang, who was also arrested last week.

Qu Ye, of Kew, who was also charged last week, appears as a director on company documents transferring the ownership of Prospero from Cayman Islands-based LQY Markets Limited to CJ Prime Financial, in 2020.

Mr Qu was also a director of Prospero from May 2020 until March 2021.

Mr Qu, Mr Wang, and four others in addition to Mr Chen, appeared in court on Thursday last week to face a number of conspiracy to money-launder charges. Most of the charges relate to alleged proceeds of crime totalling more than $10m.

All of the accused reside in Melbourne’s eastern suburbs.

A source has told The Australian that it is common knowledge in the Chinese community that Changjiang Currency Exchange and Prospero were run by the same people.

Prospero also told its clients in the communication seen by The Australian that it had the right to close their accounts with 14 days’ notice.

“We hereby notify you of our decision to terminate the T&Cs (terms and conditions) by 5pm AEDT on 12 November, 2023.

“Additionally our ability to quote pricing for some products has been terminated, and we are very likely to lose the ability to quote prices for remaining products at any time without notice.

“As a result, an event of default has occurred under ... the T&Cs and we are of the view hat more events of default may occur soon.’’

Prospero’s website says that “We regret to inform you that due to circumstances out of our control Prospero Markets’ (sic) are not able to accept any new account opening requests.

“We apologise for any inconvenience this may have caused.’’

The Australian has attempted to contact Prospero Markets several times by telephone over the past few days however no one has answered.

Originally published as A trading platform with links to companies raided by the AFP last week has had its accounts frozen