By Rhiannon Hoyle


Australia's corporate watchdog is suing cryptocurrency exchange Binance over allegations that hundreds of retail clients of its local derivatives unit were denied important consumer protections after being misclassified as wholesale clients.

The Australian Securities and Investments Commission, which last year cancelled the Binance unit's Australian financial services license, said Wednesday it alleges that the company offered crypto derivative products to 505 Australian retail investors who were misclassified as wholesale clients between July 2022 and April 2023. It said the company failed to provide these clients with a product disclosure statement and access to a compliant dispute resolution scheme, among other alleged breaches.

"Many of these clients suffered significant financial losses," ASIC Deputy Chair Sarah Court said.

The regulator said it will be seeking penalties, declarations and adverse publicity orders.

Binance didn't immediately respond to a request for comment.


Write to Rhiannon Hoyle at rhiannon.hoyle@wsj.com


(END) Dow Jones Newswires

12-17-24 2338ET