We have received a critical comment regarding our Request 4 Information regarding Spectrum Payment Services Limited d/b/a CardOneMoney in connection with its offshore client Raw Trading Ltd, registered in Seychelles. We were asked why we find it worth mentioning that a broker has a business relationship with a UK Financial Conduct Authority (FCA) regulated payment institution. We wouldn’t make a story out of anything there. Alright, we see it differently. Here’s our response to the comment.
Read our R4I regarding Spectrum Payment Services here.
The watchdogs
Regulated financial institutions must thoroughly screen their client as part of their KYC/AML obligations – both at initial onboarding and on an ongoing transactional basis. Suspicious transactions must be reported to the regulator by the financial institution concerned. This is the usual process and obligation of a regulated financial service provider such as Spectrum Payment Services d/b/a CardOneMoney. These financial institutions are the watchdogs of the financial system and must prevent money laundering to the best of their ability.
CardOneMoney addresses the forex sector acting as a high-risk payment services provider. As such, the payment institution should have experience dealing with high-risk customers.
The unauthorized high-risk client
In the case of the CardOneMoney client, the offshore broker Raw Trading Ltd, we established the following facts:
- High-risk merchant: Raw Trading operates in the high-risk area of online trading and therefore stricter KYC/AML checks must be carried out by the financial institutions.
- Illegal activities: the broker registered in Seychelles and licensed by the Financial Services Authority (FSA) there has no permission to operate in the UK or Europe. Although another company in the IC Markets group, IC Markets (EU) Ltd has a license from CySEC in Cyprus but that does allow Raw Trading Ltd to offer its regulated services in the Uk and the EU.
- SEPA Payments: The Single Euro Payments Area (SEPA) is a payment system für Europe and Euros. Raw Trading has established SEPA bank transfer as a means of payment, i.e. its system is designed to offer its services to clients in the Euro countries.
- Consob blackout: In October 2020, the Italian Consob issued a order to black-out the IC Markets a/k/a IC Markets Global operated by Raw Trading .
- FCA warning: UK regulator issued a warning against Raw Markets and IC Markets but the warning was later withdrawn, probably due to intervention.
Read our latest review on the IC Markets group here.
Preliminary conclusion
FinTelegram uncovered that Raw Trading operates without the required regulatory permission and thus in the UK and the EU. It accepts clients from the UK and the EU in different reviews over several months. In addition, the onboarding, including KYC/AML checks, is not done properly. In particular, deposits via bank transfer to the Raw Trading bank account at Spectrum Payment Services are possible before verifying the new client’s identity.
Spectrum Payment Services has a KYC/AML monitoring problem in our legal and regulatory opinion. Otherwise, the offshore broker should have been terminated as a client. This is also the opinion of PayCom42 analysts, who have placed CardOneMoney on their “Orange Compliance List” because of KYC/AML flaws.
Discuss or share
If you have an opinion about our amount, please leave a comment. If you have any information on this topic, please share it with us through our whistleblower system, Whistle42.
