Australian Court Orders BPS Financial to Pay $14 Million Over Qoin Wallet Breaches

Australia's Federal Court has ordered BPS Financial Pty Ltd to pay a total of $14 million in penalties for unlicensed conduct and misleading representations related to its promotion and operation of the Qoin Wallet crypto product.

BPS Financial promoted the Qoin Wallet as a non-cash payment facility linked to a digital token known as Qoin. In 2024, the Federal Court found that the company had engaged in unlicensed conduct for nearly three years by issuing the Qoin Wallet and providing related financial advice without holding an Australian Financial Services Licence (AFSL). The Court also determined that BPS Financial made several false and misleading statements about the product.

The matter was further examined in 2025, when the Full Federal Court found that BPS Financial had engaged in unlicensed conduct for an additional 10-month period. The Court ruled that the company could not rely on the "authorised representative" exemption under the Corporations Act when issuing the Qoin Wallet.

Under the latest orders, BPS Financial must pay $2 million in penalties for unlicensed conduct and $12 million for misleading and deceptive conduct.

In delivering her judgment, Justice Downes said BPS Financial "engaged in serious and unlawful misconduct during the period from January 2020 until mid-2023." She noted that the $2 million penalty for unlicensed conduct serves the primary purpose of deterrence, both for BPS Financial and for the broader digital asset industry.

Justice Downes also stated that the cumulative $12 million penalty for misleading representations "properly reflects the mitigating factors while also accounting for the objective recklessness of the conduct, involvement of senior management, the serious and misleading nature of the representations, the characteristics of the target audience and BPS's inadequate compliance systems."

In addition to the financial penalties, the Court imposed several non-monetary orders. These include permanently restraining BPS Financial from making false or misleading representations about the number of Qoin Wallet holders, the ability to exchange Qoin tokens for fiat currency or other crypto-assets, and any claims of official approval or registration. The company is also barred for 10 years from carrying on a financial services business without an AFSL.

The Court further ordered BPS Financial to publish an adverse publicity notice on the Qoin Wallet application and to take steps to request that the publisher of the qoin.com website do the same. BPS Financial was also ordered to pay most of the costs incurred by the Australian Securities and Investments Commission (ASIC) in bringing the proceedings.

ASIC reiterated its warning to consumers to be cautious about claims made in relation to crypto-assets and related products, and pointed to its Moneysmart website for information on the risks associated with investing in crypto-assets.