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False Australian Credit Licence Claims Result in Non-Conviction Bond

Melbourne’s Helio Lending receives a non-conviction bond after misleadingly claiming an Australian credit licence, eroding trust in its cryptocurrency-backed loan services.

Key Points

  • Melbourne’s Helio Lending faces legal repercussions for falsely claiming possession of an Australian credit licence (ACL).
  • ASIC exposes Helio Lending’s inaccurate statement about holding ACL 391330 in August 2019.
  • Trust and reputation are compromised as cryptocurrency lender misrepresents its licensing status.
  • Helio Lending receives a non-conviction bond of AUD 15,000, highlighting the seriousness of its misleading claims.

Melbourne-based cryptocurrency lender, Helio Lending, has found itself caught up in a legal entanglement.

The lender has been handed a non-conviction bond after it was discovered that the company had made inaccurate claims about possessing an Australian credit licence (ACL), a crucial license that establishes credibility within the financial sector.

ASIC Sheds Light on Misleading Claims

Details of the misleading claims were revealed by the Australian Securities and Investments Commission (ASIC), the regulatory body responsible for overseeing financial markets and companies.

It was discovered that in August 2019, Helio Lending made a public statement on its website, asserting that it held the credit licence ACL 391330.

However, ASIC’s investigation revealed that not only did the company lack this license, but it also did not represent any ACL holder at the time of the proclamation.

Trust and Authenticity at Stake

As cryptocurrencies gain popularity and integration into mainstream financial systems, inaccurate claims such as these can mislead potential customers.

Helio Lending had established its reputation by offering cryptocurrency-backed loans, allowing clients to use digital currencies as collateral. Trust and authenticity play a critical role in this model, making Helio’s misrepresentation of their licensing status a significant breach of trust with their clientele.

Non-Conviction Bond Imposed

Helo Lending has been given a non-conviction bond of AUD 15,000 ($9,600) to be maintained for 12 months.

This type of bond suggests that if the company demonstrates good behavior during this period, no further legal action will be taken. Sarah Court, the Deputy Chair of ASIC, emphasized during a press statement that Helio had falsely claimed to hold an Australian Credit Licence, leading customers to believe they had the protections associated with such a license.

Further examination of Helio’s operations reveals that it operates as a subsidiary of the American conglomerate, Cyios Corporation, which also steers the emerging non-fungible token platform Randombly. Helio’s claim to possessing an ACL allegedly originated from its acquisition of Cash Flow Investments in late 2018.

Concluding Thoughts

From a legal standpoint, there are significant consequences for making misleading claims. Helio’s sentencing falls under section 19B(1)(d) of the Crimes Act 1914(Cth). Additionally, making false claims about an ACL directly contradicts section 30 of the National Consumer Credit Protection Act 2009.

As the cryptocurrency realm continues to expand, transparency is crucial for institutions. Regulatory compliance is not enough; institutions must also build and maintain trust with the growing base of cryptocurrency enthusiasts and investors.