ASIC v ISX Hearing, page-2389

With the ISX short report in Sept 2019, the ASX suspension of ISX in Oct 2019, the ASX Statement of Reasons for the suspension of ISX and the various derogatory innuendo from some Australian media, I believe the ASIC lawyer in his closing address, summarised an ASIC claim against ISX completely when he stated “we have no evidence” in their claim that the performance shares were gained for “improper purpose”. The closing address statement from the ASIC lawyer that we have “no evidence” backs up the claim from ISX that the ASX suspension of ISX was purely innuendo and suggests there was no factual evidence for the initial suspension of ISX in Oct 2019. In addressing the 3 ASIC claims against ISX and John Karantzis the ASIC lawyer pleaded with the presiding judge to dismiss all the ISX witnesses’ testimonies because he felt they were advocates for the defence and were not reliable witnesses. These experts included Clayton Utz, who were recommended by ASX to review ISX’s client contracts and, who found nothing misleading in any of ISXs announcements on the ASX. Another expert for ISX included a highly regarded commercial lawyer whom ISX relied on “in good faith” and who advised ISX that they did not need to announce the Visa suspension because the issue was incomplete until 12th May 2020 when, after months of negotiation, the final letter from Visa to ISX was received. ISX then advised the Cyprus Central Bank of Visa’s final decision and ISX announced the Visa contract position on the 24th May 2020. The ASIC lawyer also pleaded with the presiding judge to dismiss the testimony of the ISX expert witness regarding the supposed misleading 15% statement from John Karantzis in August 2019 at an Investor Briefing. The ISX expert witness stated that John Karantzis statement at the briefing was largely irrelevant as the ISX 4C at end of June 2018 was clear that the “cost of goods” had risen substantially and it was this document that shareholders relied upon rather than a verbal Investor Briefing where questions can be misunderstood.

The arrogance of ASIC is on full display in this case as they are trying to win with “no evidence” and “pleadings” to dismiss all of the ISX expert witness’s testimonies. Just because it is ASIC being the prosecutor in this case, I don’t believe, will sway the Federal Court judge in his truthful decision next year.

What is glaringly obvious in the ASX issues with ISX is that the ASX were aware before October 2019 that ISX wanted to become a major shareholder of NSX and were ready to develop a stock exchange settlement platform that could settle trades “same day” and be able to meet the most advanced global AML regulations. ASX at the time were struggling to update their Chess platform and realised that NSX could achieve an advanced trading platform much quicker than the ASX and that could meet the most advanced global AML regulations and enable “same day” settlements that Chess still can’t meet to date.

ISX were also very clear and “up front” in their announcements that they were developing a payment system for merchants that eliminated the need for cards and offered a reduced cost for merchants in accepting customer payments. ISXF have now launched Paidbybank which, as announced, eliminates the need for card schemes and networks and offers a seamless experience for merchants and their customers. Visa had realised for some time that ISX had patents covering their advanced payment methods and would most likely develop a payment gateway that undercuts Visa merchant fees considerably. ISX and now ISXF have scheme arrangements with most of the global card companies and highly regulated EU/UK banking licenses; it is only Visa that suspended ISX. Visa is well known for trying to eliminate any upcoming competition.

The great news for ISXF shareholders is that ISXF are successful in the EU/UK and with other countries in their sights. I believe the recent announcement of the partnership with WIX is an example of how beneficial the patented payment platform, that ISXF have developed, is in increasing merchant customer on boarding and at a reduced merchant fee.

I am an early investor in ISX and continued to buy shares. I have no other association with ISX, SP1 or ISXF.