Guernsey Fines Company, Director for Russia-Related Sanctions Breaches
Guernsey, a self-governing British Crown dependency in the English Channel, announced fines of 175,000 pounds (about $230,000) and 35,000 pounds (about $45,000) against a company and its director, respectively, for Russia-related sanctions violations. The Guernsey Financial Services Commission said ITI Trade and Alex Phil, its director, committed “wide-spread and systemic breaches” of sanctions regulatory requirements related to its Russian clients and “failed to ensure appropriate and effective” procedures against money laundering and financing terrorism.
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Guernsey said ITI Trade, an investing services company, used a “sister company” in Russia for “customer onboarding, transactional monitoring, and relationship management.” The sister company also provided the firm’s “high volume algorithmic trading customers with direct market access to the Moscow Stock Exchange.”
Despite the sanctions risks posed by Russia, ITI Trade “failed to take reasonable measures to identify” its clients, Guernsey said, adding that the company didn’t screen them against sanctions lists. The firm “made no attempt to find out who the underlying clients were or ensure [customer due diligence] carried out was adequate and that individuals had been subject to sanction screening.”
“A significant proportion of the Firm’s customers, due to their geographical location and that of their source of funds, posed a high-risk of money-laundering," Guernsey said. "With such a high level of risk it was imperative that the Firm had effective and appropriate policies, procedures and controls to manage and mitigate these risks; the Firm did not have such controls in place.”