JP Markets is a name well known to all forex brokers and traders, and accordingly, they should be on high alert as judgement was handed down on 4 March 2021 by AJ Gibson of the Western Cape High Court dismissing Justin Paulsen’s business rescue application (“High Court Order”). See extract below:
“Placing the first respondent [JP Markets SA Proprietary Limited] into business rescue proceedings will accordingly be of no assistance to it. The First Respondent [JP Markets] will be unable to operate its business without a license, and the business can therefore not be saved. There is no prospects of rescuing the company”.
In the absence of a successful appeal, it seems that this High Court Order seals the company’s fate, which means that liquidation is seemingly imminent – it is just a matter of when.
This is quite the opposite outcome of what Justin Paulsen anticipated, as traders will recall the post he made on Instagram, on 20 December 2020, claiming that “when they [JP Markets] wins the business rescue application, not if, but when they win the application, they will be allowed to enter the market again”.
The reality of the matter is that JP Markets has been handed a double blow:
- The first being – the Financial Services Tribunal dismissing JP Markets application for the reconsideration of the decision by the Financial Sector Conduct Authority to suspend the licence of JP Markets; and
- The second being – the Western Cape High Court dismissing the application for JP Markets to be placed in business rescue.
The decisions referred to above are contained in the latest circular of creditors (“Circular”) that the Joint Provisional Liquidators (“Liquidators”) issued.
A copy of the Judgements are included in the link, which will provide you with more insight and clarity as to why JP Markets respective applications failed.
It has been approximately six months since the Gauteng High Court handed down judgment for the final liquidation and winding-up of JP Markets, and all the traders who have their funds frozen in the trading account of JP Markets are in no better position, nor do they have clarity on when their funds will be paid out by JP Markets.
AS A CONSEQUENCE OF THESE JUDGEMENTS, where does this leave traders?
Well, according to an extract of the Circular, the Liquidators of JP Markets have stated that they “will not be able to reduce the funds into our [their] possession and commence with the process of finalizing the administration, receiving claims and making a distribution, until such time as the appeal that was noted by the erstwhile Directors has been dealt with”.
Considering the above statement, particularly the aspect dealing with the appeal, it seems that Justin Paulsen intends to appeal the decision taken in respect of the High Court Order. It is worth noting that only until such time that the leave to appeal has been denied, then only will the Liquidators be in a position to proceed with the winding-up of JP Markets by putting into place a definitive timeline for the liquidation and intended distribution.
To this end, we reiterate advice (as mentioned in our previous article Part 1 – Forex Brokers and Traders Stay Woke) that if you are a trader whose funds are frozen in the JP Markets trading account, consider yourself a creditor in this matter.
In order to recover your funds, you are required to ensure that the Liquidators know that you are a creditor by placing your claim on record, by completing and submitting a formal claim form. This way, you will ensure your claim is on record and be kept up to date on any developments and notices that the Liquidators may issue.
If you have not done so already, we suggest that you attend to this as soon as reasonably possible. If you are one of the traders who need to get in touch with the Liquidators to lodge your claim, please do not hesitate to contact BBP Law Attorneys for assistance, as we are already acting for traders in this matter.