Finanstilsynet inspection of Venter Exchange ApS
Statement of inspection in Vester Exchange ApS (money laundering area)
On December 5, 2017, the Danish FSA was on inspection in Vester Exchange ApS. The inspection was an investigation of the money laundering area as part of the ongoing supervision of the company. The inspection included, in particular, the company’s risk assessment in the area of money laundering, money laundering policy and customer knowledge procedures.
Risk assessment and summary
Since January 10, 2014, the company has had a limited license to provide payment services in Denmark, cf. the Payment Act (money transfer business). The company’s business model consists primarily of transferring money to and from a number of African countries, primarily to Somalia, but also to Kenya, Uganda and Ethiopia. The money transfers are in practice through the company’s partner in Dubai, the Sundus Exchange, with which the company regularly settles the money transfers. In addition, the company is the agent of Western Union, which company was not covered by the inspection.
The FSA considers that the company’s inherent risk of being abused for money laundering or terrorist financing is high. The Danish FSA’s assessment is based on the company’s business model combined with the fact that the company primarily transfers money to Somalia.
Based on the inspection, there are a number of areas that give rise to supervisory reactions. In view of the time that has passed since the inspection was carried out, the Danish FSA is aware that conditions may have changed significantly.
The company is instructed to prepare a risk assessment. The Financial Supervisory Authority finds that it was under preparation during the inspection. The company is also required to revise its internal guidelines, including drafting a money laundering policy, which is based on the company’s risk assessment. In addition, the guidelines must be updated as well as a description of the company’s internal controls.
Finally, the company is instructed to ensure that business investigations and reporting obligations are followed. It was found in a sample that the company does not in all cases record and document the result of investigations of suspicious transactions that are not notified to SØIK.
Categories: Anti-Money Laundering Finanstilsynet Updates Inspection Reports