Shipkevich Bitcoin and ICO Attorney
Felix Shipkevich May 5, 2010

The FSA imposed a financial penalty of £140,000 on Alpari (UK) Ltd, an online provider of foreign exchange services for speculative trading, for failing to have in place adequate anti-money laundering systems and controls. Its former money laundering reporting officer (MLRO), Sudipto Chattopadhyay, has also received a financial penalty of £14,000.

FSA regulated firms should carry out risk assessments of the money laundering and financial crime risks that they are exposed to. However, between September 2006 and November 2008, Alpari failed to carry out thorough assessments and, as a result, put the firm at risk of being used to further financial crime.

Alpari failed to carry out satisfactory customer due diligence procedures at the account opening stage and failed to monitor accounts adequately. These failings were particularly serious as Alpari’s customer base included those from higher risk jurisdictions, such as Nigeria, and its customer relationships did not operate on a face to face basis.

Alpari also failed to have in place adequate systems for screening customers against UK and global sanctions lists and for determining whether customers were politically exposed persons (PEPs).

Despite increasing its customer base from 400 to 11,500 live accounts between mid 2007 and mid 2008, Alpari did not expand its compliance and anti-money laundering function in line with the rest of the business and placed too much responsibility on Chattopadhyay.

Margaret Cole, director of enforcement at the FSA, said:

“The FSA expects firms to assess the financial crime risks to which they are exposed properly. The FSA also expects expanding businesses to commit sufficient resource to their compliance and anti-money laundering functions. Alpari failed to operate and maintain adequate money laundering systems and controls, leaving it open to the risk of financial crime.”

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