iSignthis (ASX: ISX) has launched Australian Federal Court proceedings against the ASX regarding the “procedural fairness” of exchange’s decision to suspend its shares from trading for the past nine weeks.
The company pointed to the apparent discrepancy in the exchange’s decision to allow Westpac Banking Corporation’s (ASX: WBC) shares to continue trading despite Federal Court proceedings against the bank for 23 million alleged breaches of anti-money laundering laws.
In its court filing, iSignthis is seeking orders that the ASX lifts the trading suspension on its securities that has been in place since 2 October and reinstate them to quotation on the exchange.
iSignthis claims the ASX exercised its power to suspend the company’s securities from quotation without any prior notice.
The company is also alleging the ASX failed to provide it with the particulars of the alleged issues and that iSignthis has not been given an opportunity to address the alleged issues.
iSignthis pointed out that Westpac’s shares had not been suspended from official quotation despite the Australian Transaction Reports and Analysis Centre (AUSTRAC) launching legal action against the entity – alleging it had breached the Anti-Money Laundering and Counter-Terrorism Financing Act on over 23 million occasions.
In addition to the trading suspension allegations, iSignthis has also accused the ASX of leaking confidential information it had given the regulator in response to its multiple queries.
A ‘necessary’ pathway
Although stating it regrets this pathway, iSignthis claimed it was “necessary”.
“We have taken this step in order to lift the suspension of iSignthis’ shares,” chairman Tim Hart said.
He added the company was acting in the interest of its shareholders, which have been denied “the basic right” to trade its shares for “too long”.
Commenting on the situation, iSignthis chief executive officer John Karantzis said the company had “responded promptly” to each of the ASX’s four requests for information.
“We have answered scores of questions and provided more than 2,000 pages of confidential documents dating back almost three years.”
“We have been patient and acted in good faith, but the company’s shares have been suspended for nine weeks,” Mr Karantzis noted.
According to iSignthis, since its trading suspension it has answered numerous questions from the ASX including whether or not it offers services for initial coin offerings, how its revenue it broken down by country, the website names a customer uses, why a particular European bank was selected to hold client funds, how Apple’s privacy setting changes have affected revenue and why its bundled service is billed on a bundled basis.
iSignthis has also raised concerns about “procedural fairness and good faith” regarding the ASX’s actions.
The company also noted it still hasn’t received a “substantive question about the actual reason for the suspension” or been provided with “precise steps” to have the suspension lifted.
Also listed on the Frankfurt Stock Exchange, iSignthis provides remote identity verification and payment authentication services.
The company provides an end-to-end onboarding service for merchants with its unified payment and identity service via its Paydentity and ISXPay solutions.