Tyson Scholz (ASX Wolf) violated Australian financial market laws, says Federal Court

The Federal Court of Australia recently found a popular social media influencer, ASX Wolf, in violation of the country’s financial market laws. ASX Wolf’s real name is Tyson Scholz, and he came to the authorities’ attention after a number of civil complaints filed by the Australian Securities and Investments Commission (ASIC). ASIC blamed Scholz for offering financial advice as a service without having a license to do so, which is mandatory in the country.

According to the regulator, Scholz did this consistently between March 2020 and November 2021, and he even offered seminars and trading courses on equities listed on the Australian Stock Exchange (ASX). On top of that, he also offered recommendations for shared purchases on Instagram and private online forums.

Scholz’s customers were exposed to risk

Over the course of nearly two years, Scholz gathered over 20,000 followers. He convinced investors and traders that he knew what he was doing by posting photos of expensive boats and cars featuring the “ASX Bull” license plates. Using photos like these as bait, he attracted investors, indirectly promising that following his advice could ensure that they would become just as wealthy and able to afford the same things.

Sarah Court, Deputy Chair at ASIC, stated that financial services laws were set into place to protect investors if things go wrong. However, they also hold financial experts in check, making sure that they do not over-promise in order to attract investors. This is why licenses for this kind of thing exist.

Court added that individuals who attended Scholz’s seminars, paid for tips, or accessed private online forums, did not enjoy the benefit of the protections that the authorities have set into place. This is especially true for those who actually followed through on Scholz’s advice and purchased shares based on his statements and recommendations.

Scholz has developed an entire program

There is also evidence that Scholz put a lot of thought into organizing his program. He created several membership tiers and subscriptions, with the higher stages of membership providing subscribers with one-year access to a private Discord chat group that he created, known as the Black Wolf Pit.

Initially, the regulatory watchdog issued a warning against such practices, targeting specifically the so-called finfluencers (financial influencers), who offered financial advice while attracting users with their own luxurious lifestyles. After the warning, ASIC even resorted to threatening illegal influencers with penalties and jail time, even making an effort to warn Australian companies not to associate themselves with these individuals.

The court itself noted that even if the “finfluencers” did not make direct recommendations to buy certain shares, the fact that they indirectly indicated that this was the right thing to do would be enough to consider such behavior a violation of the law.