ASIC Probes Potential $138 Million Investment Scam
The corporate regulator is investigating Trade Prime and director Matthew Starkey over claims that investor funds remain frozen.
Updated on Oct. 21, 2026 in Investing
Live Poll
Do you trust that financial regulators are doing enough to protect investors from potential fraud?
The Australian Securities and Investments Commission (ASIC) is investigating a potential scam involving $138 million of investor funds that clients are currently unable to withdraw. The probe centres on the firm Trade Prime, formerly known as MGF Capital, and its director, Matthew Starkey.
Why it matters
ASIC is scrutinising the firm for potential misconduct, including whether it provided retail services while restricted to wholesale clients, which carries a significant risk of consumer harm. The investigation also examines whether the company failed to maintain mandatory governance and compliance standards.
The probe involves $138 million in investor capital, with some individual losses reaching $1.6 million reported as early as 2022. The firm MGF Capital, now Trade Prime, holds an Australian Financial Services Licence but was exempt from membership with the Australian Financial Complaints Authority.
The players
ASIC
The Australian Securities and Investments Commission is the government body responsible for regulating markets and protecting consumers from financial misconduct.
Matthew Starkey
He is the director of Trade Prime, formerly known as MGF Capital, and previously worked as a trader at Goldman Sachs.
Trade Prime
Formerly known as MGF Capital, this investment firm holds an Australian Financial Services Licence and is currently under regulatory investigation.
The details
Regulators are investigating whether Trade Prime provided retail services despite licence restrictions and if the firm lacked proper oversight arrangements. The company's director, Matthew Starkey, is a former Goldman Sachs trader and the former chief operating officer for Mine Digital.
Timeline
In 2022, Matthew Starkey and Mine Digital were involved in legal action.
On 21 October 2026, ASIC confirmed the ongoing investigation into the firm.
Market Dynamics
This investigation highlights the ongoing regulatory focus on the compliance and governance of financial service providers operating under Australian Financial Services Licences. It underscores the potential for consumer harm when firms operate outside their authorised retail or wholesale capacities.
Investors who find their funds frozen in accounts associated with Trade Prime should monitor ASIC updates for guidance on potential recovery efforts. This situation serves as a reminder to verify the specific authorisation of a financial provider before committing capital to investment products.
The takeaway
When choosing an investment firm, always verify that the provider holds the correct license for the specific retail services offered. Reviewing a firm's membership with formal dispute resolution bodies can provide an essential safety net for your investment capital.
Further reading
For more information on market regulations, visit the Investing section.
Live Poll
Do you trust that financial regulators are doing enough to protect investors from potential fraud?
