Exclusive: USGFX Faces Complaint for Misappropriation of Client Funds

Fazzaco Exclusive... Fazzaco learned that the Union Standard International Group Pty Limited (USGFX) has been hit with a complaint filed with the Australian Financial Complaints Authority (AFCA) by its clients in Taiwan, China for misappropriation of client funds. 

​The complaint stated that in 2018, the 23 victims who jointly filed this complaint opened 30 Trust Deposit Accounts with the USGFX by making international wire transfers to the Commonwealth Bank of Australia (CBA) which provided Client Trust Accounts for the USGFX to invest in one of the Australian broker's Trust Deposit Schemes. The scheme allowed investors to withdraw the balance in their accounts at any time and neither the broker nor the trust agency was permitted to move or use any of the clients' funds.  

However, according to the complaint, this year the USGFX has unlawfully, knowingly and intentionally transferred the complainants' money in the Trust Deposit Accounts to a newly launched scheme without informing them. As a result, funds of the complainants were frozen after the broker entered voluntary administration. The harmed investors, therefore, alleged that the USGFX misappropriated client funds, breaching the Client Money provisions.

Additionally, the complaint further alleged that the CBA as the provider of the Client Trust Accounts in this case should also be blamed for breaching its obligation to manage the account prudently and manage assets in the best interests of the beneficiary.