IG Markets operates an online platform for contracts for difference, or CFDs. These derivatives let clients take a position on price movements without owning the underlying asset.
Its internal systems also contained test markets, used to check new features and system changes. On 16 and 17 April 2020, an employee’s configuration change accidentally made some of those test markets available to clients.
One was Test FX. It was not tied to a real market, used the fictitious currency “QNZ”, and moved upwards in uniform increments.
Adam Tomasso found it on his iPhone late on 16 April. He opened and closed a small trade, then progressively increased his positions by making offers using quotes generated by IG’s computerised system which IG accepted automatically, without human intervention as was the test design intention.
He took positions on up to one million contracts. Across three trading windows he completed 19 Test FX transactions. His online trading account showed a credit balance of more than $5.5 million
At about 2 pm on 17 April, IG’s systems detected the unusual QNZ conversions. Its staff identified that five clients had traded on the test markets, restricted their accounts, removed the products and processed a $5,518,251.44 correction against Tomasso’s account. IG did not contact him before doing so.
Tomaso sued in the Supreme Court of Western Australia for the return of the funds and IG counterclaimed on the basis that when the relevant contracts were made, it believed they concerned an investment other than the Test FX market that had been made visible by error.
The dispute centred on clause 11 of IG’s standard customer agreement. It allowed the company, without the client’s consent, to void a transaction from the outset or amend its terms if the company reasonably believed an error was obvious or palpable. The client had no matching right, and the clause also allowed IG to do nothing.
IG said that power was necessary to protect against financial, operational, reputational and regulatory risks caused by obvious errors. Tomasso argued the term gave the company a one-sided escape route from its own mistakes and was thus an unfair contract term under the Australian Securities and Investments Commission Act.
Justice Jenni Hill accepted that the clause was expressed reasonably clearly. Transparency, however, was not enough to save it.
The judge found a significant imbalance because IG alone could decide whether to void, amend or leave an affected transaction. Clients could not ask for an amendment where an error harmed them; indeed, another term said a client’s own erroneous trades remained binding.
The clause was also not a significant imbalance . A more balanced provision could have made an affected transaction void from the outset, or allowed the client to seek an amendment. The court noted a related IG group company had used a clause which gave clients that latter right.
She agreed the “manifest error” clause was an unfair contract term and was thus void in its entirety, although the rest of the customer agreement remained .
Tomasso was entitled to $5,518,251.44 in damages, plus interest to be determined.
The court also rejected the contention that the clause defined the agreement’s main subject matter – which would take it outside of the unfair term regime – and found the Test FX UP trades still fell within the agreement.
IG’s counterclaim separately sought to set aside the trades for unilateral mistake. The court found its actual mistake was making the test market available, but the counterclaim had alleged a different mistake: that IG Markets believed it was contracting in relation to a real financial instrument or investment.
Because the pleaded case did not match the mistake established by the evidence, the counterclaim was dismissed.
Justice Hill nevertheless made firm factual findings about Tomasso’s conduct. From at least the fourth trade on the first evening, he knew or strongly suspected that Test FX UP was a test market and that profits were certain or near certain. Had IG Markets established the unilateral mistake it pleaded, the judge said equity would have warranted setting the transactions aside.
Six weeks after the August 2025 judgment, IG applied for leave to amend its defence and counterclaim. It submitted that the real case at trial had been whether Tomasso knew or suspected that he was trading on a test market made available by mistake. It said the amendment would simply bring the pleading into line with the way the case had actually been run, without needing the hearing to be reopened.
Tomasso opposed the application. He contended that the amendment was inconsistent with the primary reasons, that the trial had remained within the pleaded issues, and that IG had not explained its delay.
The court rejected the suggestion that the trial had been conducted on the basis that the availability error alone was the relevant contractual mistake.
The proposed amendment also did not explain how the error concerned a fundamental term or subject matter of each contract. The court said the alleged mistake was, at most, an assumption on which IG Markets’ algorithms accepted Mr Tomasso’s offers. Unless that assumption formed part of the contracts’ terms, the contracts remained binding.
Justice Hill agreed the proposed change also sat uneasily with the primary reasons. Those reasons had concluded that the transactions were in relation to an “Instrument” under the agreement, and that making the test markets available for trading meant they were an “investment”.
Even if the amendment had reflected the way the case was run, the judge reasoned the late amendment request would still have been refused. Allowing it would have required further submissions and supplementary reasons, it was inconsistent with the primary findings, no explanation had been given for the delay, and the proposed pleading was in a form that ought to be struck out.
IG’s application to amend its counterclaim was dismissed. It would seem Mr Tomasso gets to keep the entire $5.5 mil and gets the majority of his legal costs paid by IG.
Tomasso v IG Markets Ltd [2025] WASC 338, Hill J 21 August 2025
Tomasso -v- IG Markets Ltd [No 2] [2026] WASC 219 Hill J 4 June 2026
