It has now been almost six weeks since iSignthis Ltd (ASX: ISX) shares were last trading on the ASX boards.
The controversial payments company’s shares were forced into a trading halt on October 2 and have remained there ever since.
Why are iSignthis shares still suspended?
This afternoon iSignthis announced that it has received correspondence from the Australian Securities and Investments Commission (ASIC) in relation to the suspension.
According to the release, ASIC has confirmed in writing that it did not request the suspension of iSignthis’ shares. As such, it has referred the company to the Australian Securities Exchange (ASX) for an explanation as to why its shares were suspended in October.
The company’s chief executive, John Karantzis, appeared frustrated with this development. He said: “It has taken us more than a month to get an answer to a simple question about who actually asked for the suspension of ISX shares.”
The ASX was quick to respond to iSignthis and provide clarity on the situtation.
It stated that the basis for the suspension of its shares was clearly set out in its announcement to the market on October 2.
That announcement stated: “In consultation with the Australian Securities and Investments Commission (“ASIC”) and having regard to the recent volatility in its share price, ASX has determined that it is appropriate to suspend trading in the shares of iSignthis Ltd (‘ISX’) with immediate effect under Listing Rule 17.3, pending the outcome of enquiries to be made by ASIC and ASX into a number of issues concerning ISX. The securities will remain suspended until further notice.”
It then advised that it “has at no time represented to ISX or anyone else that the suspension of ISX’s securities on 2 October 2019 was at the direction of ASIC.”
Adding that it “was satisfied that the suspension of ISX’s securities on 2 October 2019 was appropriate, without any need for a direction from ASIC.”
And unfortunately for iSignthis and its shareholders, the ASX “considers it appropriate that trading in ISX’s securities remains suspended until further notice.”
If and when its shares return to trade, I would suggest investors stay well clear of them. Instead, I think fellow payments shares Afterpay Touch Group Ltd (ASX: APT) and Zip Co Ltd (ASX: Z1P) would be much better options for investors.
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James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of AFTERPAY T FPO and ZIPCOLTD FPO. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.