2024

when

April

<a href="https://bitcoinworld.co.in/asic-filed-a-lawsuit-against-asx-over-250m-software-fail/" title="ASIC Filed A Lawsuit Against ASX Over $250M Software Fail" rel="noopener noreferrer nofollow"></a>
The Australian Securities and Investments Commission (ASIC) has filed a lawsuit against ASX, accusing the company of misleading the public about a major software upgrade.&nbsp;
This project was supposed to modernize the way trades are settled using new technology, but it didn’t go as planned.
<h3 id="span-style-font-weight-400-the-asx-issue-span">The ASX Issue</h3>
In February 2022, the securities exchange told the public that its Clearing House Electronic Subregister System (CHESS) upgrade was “on track” and would be ready by April 2023.&nbsp;
But ASIC says that wasn’t true. By late 2021, ASX knew the project was in trouble. Internally, they even marked it as “red,” meaning there were serious risks. Despite this, ASX <a href="https://twitter.com/asicmedia/status/1823491475868672146" rel="noopener noreferrer nofollow">assured</a> investors everything was fine.
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">
 ASIC has commenced proceedings in the Federal Court against Australia’s largest market operator, ASX Limited, for allegedly making misleading statements related to its Clearing House Electronic Subregister System (CHESS) replacement project <a href="https://t.co/yyruQ5PpFB" rel="noopener noreferrer nofollow">https://t.co/yyruQ5PpFB</a> <a href="https://t.co/d3ZLUGMKSF" rel="noopener noreferrer nofollow">pic.twitter.com/d3ZLUGMKSF</a>
 — ASIC Media (@asicmedia) <a href="https://twitter.com/asicmedia/status/1823491475868672146?ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow">August 13, 2024</a>
</blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
ASIC’s head, Joe Longo, called this a “collective failure” by ASX’s leadership. The lawsuit claims that the actions of the exchange could have hurt the trust in Australia’s financial markets, which are a key part of the economy.
<h3 id="span-style-font-weight-400-a-promising-project-gone-wrong-span">A Promising Project Gone Wrong</h3>
The Australian Securities Exchange started working on the CHESS upgrade in 2016. They wanted to use blockchain technology to make the system more modern.&nbsp;
But things didn’t go smoothly. The project faced delays, and by November 2022, ASX had to give up on the idea. They had spent millions and still weren’t close to finishing the upgrade.
A review by Accenture found that there were major problems, like unclear timelines and poor communication between ASX and its software provider. Even though only 62% of the software was finished, ASX leaders claimed it was ready to go.
<h3 id="span-style-font-weight-400-what-happens-next-span">What Happens Next?</h3>
On 7 March 2024, ASIC announced that ASX had paid a penalty of $1,050,000 following an ASIC investigation into its compliance with the market integrity rules.&nbsp;
This lawsuit is the first time ASIC has taken ASX to court over the failed upgrade. ASX could face hefty fines, adding to the money already lost on this project.&nbsp;
The company’s stock price has dropped, showing that investors are worried about what’s next.
ASX’s CEO, Helen Lofthouse, who took over in August 2022, says the company is cooperating with ASIC and is focused on moving forward. While the lawsuit targets the company and not individual leaders, ASIC emphasizes that this was an organizational <a href="https://www.asx.com.au/content/dam/asx/about/media-releases/2024/33-14-august-2024-asx-statement-on-asic-proceedings.pdf" rel="noopener noreferrer nofollow">failure</a>.
<h3 id="span-style-font-weight-400-final-thoughts-span">Final Thoughts</h3>
The lawsuit against the Australian Securities Exchange is a big deal for Australia’s financial system. It shows how important it is for companies to be honest and transparent, especially when dealing with critical technology.&nbsp;
As the case unfolds, ASX will need to work hard to rebuild trust and prove it can manage such important projects in the future.

ASIC Filed A Lawsuit Against ASX Over $250M Software Fail

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