The Japan Securities and Exchange Surveillance Commission has petitioned the Osaka District Court for a prohibition and suspension order against BANK INNOVATION Co., Ltd., Prosperity Assurance Co., Ltd., and their representative director, Shoichiro Ando, over alleged violations of the Financial Instruments and Exchange Act. The petition targets suspected unregistered conduct covering both the offering or private placement of collective investment scheme interests and the intermediation of discretionary investment contracts. Investigators found that the firms, which were not registered under Article 29, promoted offshore collective investment scheme products including ones described as having exposure to the S&P 500 Index and a product referred to as “Evolution”, involving Singapore-based GOO PROPERTY SINGAPORE PTE. LTD. The activity included soliciting general investors, explaining expected returns, and assisting with investment agreement documentation, supported by a sub-agent network of around 120 people; the Commission estimated total investments of about JPY 6.6bn from 5,824 general investors. The firms also facilitated discretionary investment agreements under which customers entrusted GOO with authority to select and change investment portfolios, which the Commission characterised as investment advisory and agency business requiring registration. The Commission stated that the court petition seeks to stop the alleged unregistered operations and does not seek an order preventing the refund of investment funds to customers, and it reiterated investor warnings about the risks of dealing with unregistered operators outside Japan’s supervisory and investor-protection framework.

Original source View in tracker