FMA issues AML/CFT warning to Circle Markets Limited
18 October 2019
The Financial Markets Authority (FMA)
has issued a formal warning to a non-licensed derivatives
issuer and forex provider, Circle Markets Limited, under the
Anti-Money Laundering and Countering Financing of Terrorism
Act 2009 (AML/CFT).
Following a review of a sample of client files at an onsite monitoring review, the FMA found that Circle Markets Limited had failed to:
• adequately verify identity information for some
customers, as per standard customer due
diligence.
• obtain additional identity requirements
and verify the identity requirements for enhanced customer
due diligence for a customer, such as source of the funds or
the wealth of the customer.
• take reasonable steps to
determine whether a customer or any beneficial owner, is a
politically exposed person.
• conduct adequate ongoing
customer due diligence for some customers and undertake
account monitoring.
Circle Markets Limited has not disputed the FMA’s findings and its sole director (also the AML/CFT compliance officer) admitted he did not fully understand his AML/CFT obligations.
Circle Markets Limited is required to undertake a series of actions to ensure it complies with its obligations, including engaging an independent AML/CFT auditor to review its practices.
The
company is required to provide the FMA with a report by
March 2020. Failure to undertake the actions could result in
civil or criminal enforcement action.
Liam Mason, FMA
Director of Regulation said, “Circle Markets has
demonstrated a general lack of understanding and knowledge
of its AML/CFT obligations. However, it appears to be taking
steps to ensure future compliance. For example, its sole
director and an employee completed an AML/CFT training
course earlier this year.
“Financial services firms ought to be aware of their AML/CFT obligations as this legislation has been in effect for some time. We have little patience for non-compliance. If a provider is unsure of their responsibilities, we encourage them to seek professional or legal advice.”
The warning was issued under section 80 of the Act.
ENDS