High-Stakes Fight for iSignthis and Its Future in Fintech
iSignthis, an Australian fintech startup, is currently engaged in a legal fight with the ASIC (Australian Securities and Investments Commission) on allegations of misleading the market, but the company’s former CEO, John Karantzis, has been conspicuously missing from the proceedings. The former “major-general” of the firm, Karantzis, has been based in Cyprus since 2022 when his company was separated from iSignthis. A lawsuit was filed against the company and Karantzis for failing to disclose material information to the market.
The ASIC’s accusations are at odds with the success that iSignthis had when it was first listed on the ASX in 2015. Major financial services providers like Visa and National Australia Bank trusted the company’s products and relied on them to verify their customers’ identities and process transactions securely. The firm benefited from a competent board of directors and productive partnerships with other industry leaders. For the first few years of operation, revenues remained low, but in the 1st half of 2018, revenues unexpectedly soared, purportedly due to a flurry of post-dated contracts. For the 2nd half of the year, income dropped to $1 million, which is a worrying trend.
The company’s troubles didn’t begin with this claimed misstatement but rather several other factors. iSignthis’s new customers in 2019 and 2020 raised red flags because of possible ties to fraud, illegal trade, and illicit gambling. It is also claimed that iSignthis breached the law by initially concealing that Visa had severed ties with the company in April of 2020 and then again by dishonestly disclosing the news on May 24 of the same year and for much of 2020.
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