Regulators Take Action Against Online FX Broker JT Trader

Regulators Take Action Against Online FX Broker JT Trader

Regulators Take Action Against Online FX Broker JT Trader

BCSC Says “Global” Platform For Institutional and Retail Clients Operating Without a License

What Happened?

February 26, 2020: The BCSC announced that JT Trader Financial Services Ltd. was serving residents of British Columbia without a license to do so. According to its website, JT Trader is an online foreign exchange broker that offers cutting-edge trading tools to institutional and retail clients globally.

Source: https://www.bcsc.bc.ca/Enforcement/Investment_Caution_List/JT_Trader_Financial_Services_Ltd_/

Who Is Impacted?

Financial service providers offering foreign exchange, virtual asset, or fintech solutions serving audiences in multiple states (United States), provinces (Canada), or countries (Global). Risk managers for online payment services and money transfer businesses–such as Meastro, Visa, Mastercard, and WebMoney who serve JT Trader–will need to identify and reassess their own risk in doing business with and enabling these transactions for JT Trader.

Why This Matters?

According to the BCSC, JT Trader was operating out of Toronto, in the Canadian province of Ontario. Ontario is regulated by the OSC (Ontario Securities Commission). Both BCSC and OSC are members of the CSA (Canadian Securities Administrators). Due to the nature of JT Trader’s business, they will need to secure regulatory approval from every provincial regulator where they have at least one user.

What’s Next?

JT Trader’s actions have placed the company on several international watchlists and adverse media lists. Companies who serve JT Trader will need to complete risk assessments to determine if they can continue to support their business activity.

Compliance teams should consider whether their AML tools can easily identify what jurisdiction their user is from and whether they are legally able to serve the user.

If the proper licenses are in place and the user is accepted, the KYC and AML procedures need to meet the regulatory requirements of the user’s jurisdiction. An intelligent AML program should enforce country-specific workflows for user authentication, identity verification, document verification, risk screening, and data privacy.

Business managers should ensure their compliance teams are not wasting money and resources on users from jurisdictions that the company is not able to serve and, subsequently, should not be onboarding.

learn more

Is your AML compliance too expensive, time-consuming, or ineffective?

iComply enables financial services providers to reduce costs, risk, and complexity and improve staff capacity, effectiveness, and customer experience.

Request a demo today.

How to Implement Automated KYC Verification for Your Business
How to Implement Automated KYC Verification for Your Business

In today's fast-paced digital world, navigating the complex regulatory landscape can be a challenge for financial institutions and businesses. One critical aspect of compliance is Know Your Customer (KYC) verification. Manual KYC processes can be time-consuming, prone...

Hong Kong and Abu Dhabi Adopt the FATF Travel Rule

Hong Kong and Abu Dhabi Adopt the FATF Travel Rule

Hong Kong and Abu Dhabi Adopt the FATF Travel Rule

Regulators in Asia & Middle East Roll Out FATF R15.7b

What Happened?

February 24, 2020: Hong Kong and Abu Dhabi joined South Korea, Switzerland, and Singapore in adopting new policies and amendments to comply with the Virtual Asset recommendations made by global financial watchdog FATF.​

Sources:
Hong Kong – https://www.fatf-gafi.org/media/fatf/documents/reports/mer4/MER-Hong-Kong-China-2019.pdf
Abu Dhabi – https://www.adgm.com/media/announcements/fsra-updates-its-virtual-asset-regulatory-framework

Who Is Impacted?

Any VASP, as well as dealers in precious metals, stones, and jewelry, operating in Hong Kong and Abu Dhabi. This includes, but is not limited to, custody providers, trading platforms, and investment platforms.

Why This Matters?

Pending a period of public consultation, businesses now have a closing window of opportunity to bring their systems, policies, and procedures in-line with the changes included in these updates – especially if they want to continue to serve customers in Hong Kong or Abu Dhabi.

What’s Next?

Enforcement. As we saw in the United Kingdom (effective January 10, 2020) or in Singapore under the new PSA (Payment Services Act), businesses have a short window to contract an independent firm to audit their compliance systems and processes, to fill gaps in their AML program and software, and to file regulatory paperwork.

As we saw in Canada, Singapore, and the United Kingdom, this increased clarity from the regulators in Abu Dhabi and Hong Kong is expected to create problems for businesses with weak or non-existent AML programs. Today, many digital asset firms in both countries are operating without institutional-grade compliance tools for onboarding, KYC refresh, AML screening, and transaction monitoring. It is likely that the firms that are not using cost-effective solutions or have not budgeted for compliance in their business model, will either cease to exist or look to be acquired – potentially transferring their liability baggage to their acquirer.

Dealers in precious metals, stones, and jewelry are also impacted and must now implement an AML program capable of maintaining a risk-based approach for their business. This is similar to the art and collectibles industry in the United Kingdom who were taken by surprise in January when they discovered that they were now required to implement AML programs. This increase in operating cost is likely to drive significant changes to these business models as enforcements begin.

Compliance teams should review user data including IP addresses, geofencing, the jurisdiction of nationality, and jurisdiction of domicile to identify potential exposure to these new regulations. Potential risks should be assessed and written AML policies and procedures should be reviewed against the new requirements.

VASP executive teams, major shareholders, and board members should take actions to limit their personal liability and exposure–such as ensuring their staff receives updated AML training, having their AML tools audited by an independent professional, and ensuring the new costs of compliance do not hinder the viability of the business.

learn more

Is your AML compliance too expensive, time-consuming, or ineffective?

iComply enables financial services providers to reduce costs, risk, and complexity and improve staff capacity, effectiveness, and customer experience.

Request a demo today.

How to Implement Automated KYC Verification for Your Business
How to Implement Automated KYC Verification for Your Business

In today's fast-paced digital world, navigating the complex regulatory landscape can be a challenge for financial institutions and businesses. One critical aspect of compliance is Know Your Customer (KYC) verification. Manual KYC processes can be time-consuming, prone...

Regulators Take Action Against Online FX Broker JT Trader

Securities Commissions Targets OTC and Virtual Asset Trading Platform BitPrime

Securities Commissions Targets OTC and Virtual Asset Trading Platform BitPrime

Regulators Take Action Against Bitprime Ltd For Onboarding Users Without Local Licensing.

What Happened?

February 20, 2020: The BCSC identified that due to an inadequate KYC & AML program, Bitprime Ltd was onboarding clients they were not allowed to serve. BitPrime operates a platform that offers the retail trading of cryptocurrency assets.

Source: https://www.bcsc.bc.ca/Enforcement/Investment_Caution_List/Bitprime_Ltd__dba_Bitprimeprofx/

Who Is Impacted?

Fintech platforms, wealth managers, VASPs, and financial service providers who are serving users, clients, or investors in more than one jurisdiction.

Why This Matters?

Many online financial services businesses who have acquired licensing in a single jurisdiction believe that their license means they can serve the world.

This regulatory action shows that the BCSC, along with other IOSC (International Organization of Securities Commissions) members – which includes the U.S., the EU, Canada, Australia, and others – have a very different opinion on the matter.

The reality is, you can only serve the jurisdictions where you have both a license to operate in and a compliance program in place capable of meeting the local regulations of your user.

What’s Next?

BitPrime’s actions have placed the company on several international watchlists and adverse media lists. Companies and virtual asset traders who do business with BitPrime may now be subject to increased regulatory scrutiny, and they are likely to start showing up in the more sophisticated blockchain forensics tools.

To avoid this situation, BitPrime could have used a digital onboarding tool that had the capability to identify the prospective user’s jurisdiction, preventing those user accounts from being created.

While this is a relatively simple gap to close, most fintech platforms do not understand how vital it is to screen for this type of risk.

In order to avoid these regulatory actions, fintech platforms should test their compliance systems to ensure their onboarding tools can reject a user based on jurisdiction. Furthermore, these tools should be smart enough to identify and reject these users without incurring the full cost of KYC.

Executives should ensure their compliance teams are saving time and money by not wasting resources through onboarding and screening clients that the business is not able to serve.

learn more

Is your AML compliance too expensive, time-consuming, or ineffective?

iComply enables financial services providers to reduce costs, risk, and complexity and improve staff capacity, effectiveness, and customer experience.

Request a demo today.

How to Implement Automated KYC Verification for Your Business
How to Implement Automated KYC Verification for Your Business

In today's fast-paced digital world, navigating the complex regulatory landscape can be a challenge for financial institutions and businesses. One critical aspect of compliance is Know Your Customer (KYC) verification. Manual KYC processes can be time-consuming, prone...

Paris FinTech Forum 2020: Highlights and Takeaways

Paris FinTech Forum 2020: Highlights and Takeaways

Paris FinTech Forum 2020: Highlights and Takeaways

This month, iComply attended the Paris FinTech Forum 2020 with Toronto Finance International to represent Canada alongside four other innovative companies driving digital transformation in global finance. The Paris FinTech Forum 2020 (or PFF2020) hosted many of the world’s best fintech, regtech, insurtech, and financial institutions, with a focus on the evolving European ecosystem.

The event itself was two days long, packed to the brim from 7:30 AM to 9:30 PM both days with speakers, panels, workshops, networking lounges, company demo booths, and much more.

Our head of operations, Ash Viens, presented on Stage 7 to an audience keen to learn about how iComply is driving down the cost of AML compliance in key markets such as Europe, North America, and Asia. iComply’s unique value in this market is helping compliance teams to streamline and automate many of their back-office tasks, saving thousands in compliance costs annually and multiplying the effective output of their team.

Our team also held meetings with several key European banking and lending leaders, including Credit Agricole and BNP Paribas, to demonstrate how we’re helping companies automate user validation, identity verification, document authentication, AML and CTF risk screening, and ongoing monitoring across multiple jurisdictions in real-time. These firms were most impressed with how cost-effective, robust, and easy to implement iComply was compared to other solutions they have seen previously.

When you consider the impacts of Brexit, AMLD5, the FATF Travel Rule, and new digital identity regulations being implemented worldwide, many companies struggle to maintain their compliance operations and most fall back to manual workflows. Some brands are facing the reality of losing their license altogether while others, such as Revolut have had to leave Tier 1 financial markets like the UK and seek licensing in jurisdictions with lower compliance burden and oversight.

All in all, we were thrilled to be invited by TFI to participate in this year’s Paris FinTech Forum 2020, which gave our team valuable insights and relationships in the European ecosystem.

To learn more about how iComply can save you time and money on your AML compliance requirements, click below to connect with a member of our team.

2020 Paris Fintech Forum: iComply and Toronto Finance International

2020 Paris Fintech Forum: iComply and Toronto Finance International

2020 Paris Fintech Forum: iComply and Toronto Finance International

With the first few weeks of 2020 already behind us, our global calendar of events and conferences is filling up quickly!

Our team has been invited to join the Canadian delegation along with Toronto Finance International at what is considered one of the largest and most exclusive fintech events in the world.

iComply Investor Services will be heading to the Paris FinTech Forum from January 28th – 29th, as well as attending several trade meetings scheduled in the days leading up to, during, and following the event.

Hosted in the historical Paris stock exchange building Palais Brongniart, the 2020 Paris Fintech Forum brings together over 2,600 attendees from more than 70 countries worldwide, featuring more than 160 global fintech companies and nearly 300 speakers.

If you and your team plan on attending the Paris Fintech Forum this January, our team would love to connect with you! We will be available to meet throughout the Forum to discuss how we are helping fintech and digital finance companies across the globe.

To connect, secure a time slot in our calendar here.

Which speakers are you most excited to see and which companies are you most eager to meet at the Paris Fintech Forum? We want to hear your thoughts on what motivated you to attend, and what your partnership goals are for 2020!

Vaidyanathan Chandrashekhar

Vaidyanathan Chandrashekhar

Advisors

“Chandy,” is a technology and risk expert with executive experience at Boston Consulting Group, Citi, and PwC. With over two decades in financial services, digital transformation, and enterprise risk, he advises iComply on scalable compliance infrastructure for global markets.
Thomas Linder

Thomas Linder

Advisors

Thomas is a global tax and compliance expert with deep specialization in digital assets, blockchain, and tokenization. As a partner at MME Legal | Tax | Compliance, he advises iComply on regulatory strategy, cross-border compliance, and digital finance innovation.
Thomas Hardjono

Thomas Hardjono

Advisors

Thomas is a renowned identity and cybersecurity expert, serving as CTO of Connection Science at MIT. With deep expertise in decentralized identity, zero trust, and secure data exchange, he advises iComply on cutting-edge technology and privacy-first compliance architecture.
Rodney Dobson

Rodney Dobson

Advisors

Rodney is the former President of ADP Canada and international executive with over two decades of leadership in global HR and enterprise technology. He advises iComply with deep expertise in international service delivery, M&A, and scaling high-growth operations across regulated markets.
Praveen Mandal

Praveen Mandal

Advisors

Praveen is a serial entrepreneur and technology innovator, known for leadership roles at Lucent Bell Labs, ChargePoint, and the Stanford Linear Accelerator. He advises iComply on advanced computing, scalable infrastructure, and the intersection of AI, energy, and compliance tech.
Paul Childerhose

Paul Childerhose

Advisors

Paul is a Canadian RegTech leader and founder of Maple Peak Group, with extensive experience in financial services compliance, AML, and digital transformation. He advises iComply on regulatory alignment, operational strategy, and scaling compliance programs in complex markets.
John Engle

John Engle

Advisors

John is a seasoned business executive with senior leadership experience at CIBC, UBS, and Accenture. With deep expertise in investment banking, private equity, and digital transformation, he advises iComply on strategic growth, partnerships, and global market expansion.
Jeff Bandman

Jeff Bandman

Advisors

Jeff is a former CFTC official and globally recognized expert in financial regulation, fintech, and digital assets. As founder of Bandman Advisors, he brings deep insight into regulatory policy, market infrastructure, and innovation to guide iComply’s global compliance strategy.
Greg Pearlman

Greg Pearlman

Advisors

Greg is a seasoned investment banker with over 35 years of experience, including leadership roles at BMO Capital Markets, Morgan Stanley, and Citigroup. Greg brings deep expertise in financial strategy and growth to support iComply's expansion in the RegTech sector.
Deven Sharma

Deven Sharma

Advisors

Deven is the former President of S&P and a globally respected authority in risk, data, and capital markets. With decades of leadership across financial services and tech, he advises iComply on strategic growth, governance, and the future of trusted data in AML compliance.