SFC reprimands and fines CSC Futures (HK) Limited $4.95 million for regulatory breaches

The Securities and Futures Commission (SFC) has reprimanded and fined CSC Futures (HK) Limited (CSC) $4.95 million for failures in complying with anti-money laundering and counter-financing of terrorism (AML/CFT) and other regulatory requirements between January 2017 and December 2018.

The SFC’s investigation found that CSC did not conduct any due diligence on the customer supplied systems (CSSs) used by 100 clients for placing orders during the material time.? As a result, CSC was not in a position to properly assess and manage the money laundering and terrorist financing (ML/TF) and other risks associated with the use of such CSSs by its clients.

In addition, the SFC identified that the amounts of deposits made into five client accounts were incommensurate with their declared financial profiles. As a result of its failure to maintain an effective monitoring system, CSC failed to detect, assess and conduct proper enquiries on the deposits and satisfactorily address the associated ML/TF risks.

The SFC is of the view that CSC’s systems and controls were inadequate and ineffective, and CSC failed to ensure compliance with the Anti-Money Laundering and Counter-Terrorist Financing Ordinance, the AML Guideline and the Code of Conduct.

In deciding the disciplinary sanctions against CSC, the SFC has taken into account that:

• CSC’s failures to diligently monitor its clients’ activities and put in place adequate and effective AML/CFT systems and controls are serious as they could undermine public confidence in, and damage the integrity of, the market;
• a strong deterrent message needs to be sent to the market that such failures are not acceptable;
• there has been a change in CSC’s senior management after the relevant period;
• CSC cooperated with the SFC in resolving the SFC’s concerns; and
• CSC’s otherwise clean disciplinary record.

中文版本

證監會譴責群益期貨（香港）有限公司違反監管規定並處以罰款495萬元

群益期貨（香港）有限公司（群益）因在2017年1月至2018年12月期間沒有遵從打擊洗錢及恐怖分子資金籌集規定及其他監管規定，遭證券及期貨事務監察委員會（證監會）譴責及罰款495萬元。

證監會的調查發現，群益在關鍵時間內沒有對100名客戶用以發出交易指示的客戶自設系統進行任何盡職審查，以致未能妥善評估並管理與其客戶使用該等客戶自設系統相關的洗錢及恐怖分子資金籌集風險和其他風險。

此外，證監會識別到存入五名客戶的帳戶內的款項與其所聲明的財政狀況並不相稱。由於群益沒有維持有效的監察系統，故未能偵測及評估有關存款並進行適當的查詢，也未能妥善處理相關的洗錢及恐怖分子資金籌集風險。

證監會認為，群益的系統及監控措施不足及成效不彰，且該公司沒有確保《打擊洗錢及恐怖分子資金籌集條例》、《打擊洗錢指引》和《操守準則》獲得遵從。

證監會在決定對群益採取上述紀律處分時，已考慮到：

• 群益沒有勤勉盡責地監察其客戶活動，以及沒有設立充足而有效的打擊洗錢及恐怖分子資金籌集制度和監控措施，乃屬嚴重缺失，因為這可能會損害公眾對市場的信心和破壞市場的廉潔穩健；
• 有需要向市場傳遞具阻嚇力的強烈訊息，以示有關缺失不可接受；
• 群益的管理層在有關期間後已有所變動；
• 群益在解決證監會提出的關注事項時表現合作；及
• 群益過往並無遭受紀律處分的紀錄。