The Financial Sector Supervisory Commission (CSSF) announced in a that it had imposed an administrative penalty on the payment institution Sogexia S.A. for noncompliance with professional obligations related to anti-money laundering / counter financing of terrorism (AML/CFT).
The €68,000 fine was imposed on 22 February 2024 and came after an on-site inspection, said the CSSF. The inspection targeted “parts of the AML/CFT framework, in particular the process of entering into business relationships and transactions monitoring.” In its communiqué, the regulator highlighted the following points:
1. “The process of entering into business relationships was deficient and did not permit the professional to have complete and duly documented information where appropriate.” The CSSF had identified a lack of information and a non-corroboration when it came to the source of funds of certain clients. This was a breach of the obligation to “collect, record, analyse and understand the information on the origin of customers’ funds.”
2. “Shortcomings” regarding the “identification and verification of the identity of beneficial owners for certain clients” were also noted by the CSSF.
3. Sogexia’s “transaction monitoring process did not operate efficiently,” said the CSSF, with some scenarios not covering risky situations appropriately and generated alerts inadequately processed.
4. The CSSF also noted that “although there were inconsistencies and indications that generated suspicions of money laundering, (i) no further investigations were performed in order to clear them, or (ii) where applicable, the suspicious activities and/or transactions concerned were not reported to the Financial Intelligence Unit.”
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The CSSF added it had taken note of remedial actions undertaken by Sogexia after the on-site inspection to resolve the breaches identified.
Delano has contacted Sogexia for comment.
Founded in 2010, Sogexia is a payment institution authorised in Luxembourg by the CSSF and authorised in France by the French Prudential Supervision and Resolution Authority (ACPR), the Banque de France’s supervisory body.