CySec imposes administrative fine of €14.000 

Cyprus Securities and exchange commission (cysec)

CySec announcement dated 26 May 2014

The Cyprus Securities and Exchange Commission informs the investors that, at its meeting held on 10.02.2014 , decided to impose the administrative fine of €14.000 in total against “DFG Capital (Cyprus) Ltd” (‘the Company’) for breaching the Prevention and Suppression of Money Laundering and Terrorist Financing Law of 2007, as in force (“the Law”) and the Directive DI144 – 2007-08 of 2012 of the Cyprus Securities and Exchange Commission for the Prevention of Money Laundering and Terrorist Financing (“the Directive”).

More precisely, the following administrative fines were imposed:

  1. The amount of € 11.000 for violating section 58 (a) of the Law, since the systems and ways of application of customer due diligence and identification procedures have not been adequate or appropriate, according with the following articles of the Law:
  • 61:”Ways of application of customer due diligence and identification procedures”,
  • 64:”Enhanced due diligence measures” and
  • 65:”Transactions on behalf of another person” of the Act

and sections of the Directive:

  • 7:”Customers’ acceptance policy”,
  • 9:”Compliance officer’s duties”,
  • 12:”Application of measures and procedures on a risk based approach”,
  • 14:”Design and implementation of measures and procedures to manage and mitigate the risks”,
  • 18:”Obligation for customer identification and due diligence procedures”,
  • 21:”Construction of an economic profile”,
  • 22:”Specific customer identification issues”,
  • 24:”Enhanced customer identification and due diligence procedures”,
  • 26:”Ongoing monitoring of accounts and transactions”,
  • 33:”Certification and language of documents” and the fourth and fifth annex.

 

2.  The amount of € 1.000 for breaching paragraph 9 (1) [“Compliance officer’s duties”], subparagraphs (d), (j) and (k) of the Directive, since the compliance officer of the Company:

(i) did not monitor and asses the correct and effective implementation of the risk management and procedure Manual.
(ii) did not  ensure the preparation and maintenance of the list of customers categorized following a risk based approach and did not ensure the updated of the said list.
(iii) did not implement appropriate measures for detecting, recording and evaluating all risks arising from the Company’s existing customers.

 

3.  The amount of € 2.000 for breaching paragraph 5 (d) of the Directive since the Company’s Board of Directors did not assure that appropriate, effective and sufficient systems and controls are introduced for achieving the above mentioned requirement and compliance.

Finally, CySec has taken into account, as well, a number for other elements for the imposition of this administrative fine.

 

Source: CySec

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