After a years-long investigation, APRA found that Swanger did not act “with honesty and integrity” and “altered documents” during the investigation and misrepresented to regulators capital that the company had raised.
The regulator found that Wilson had similarly “misclassified” money raised by three investors separate to the Dubai investors and did not deal with APRA in an “open, constructive and co-operative way” about the nature of the capital raised.
Xinja became the first Australian bank to return its banking license in 2021, after it shocked customers and shareholders when it announced plans to close all bank accounts and refund customer savings because it could not raise funds fast enough to remain viable.
The company initially sought to “pivot” to building a US trading app, but these plans eventually collapsed, leaving investors out of pocket. Prior to Xinja, Wilson promoted his previous experience working for the National Australia Bank and Swanger had experience at Macquarie Bank’s chief investment officer. Both were contacted.
Early Xinja investor Thomas Murphy said Xinja’s directors were more interested in marketing and soliciting glowing media coverage than developing a sustainable business model, and the collapse opened wider questions about the regulations and transparency of unlisted banking companies. He said the outcome was “terribly upsetting” for the thousands of investors left empty-handed.
“This was going to be the showcase example of how young people were going to get into the market through crowdfunding,” he said. “For some, this would have been their first and last. They’ll never come back.”
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