Beta Capital Securities LLC

Beta Capital Securities LLC dba Creand Securities was fined $145,000 for failing to develop and implement a reasonably designed AMLCP, including lack of money movement supervision. The findings stated that while the firm’s AML procedures identified numerous red flags of suspicious activity, including with respect to wire transfers, the firm did not have policies or procedures that explained how and when to identify and report suspicious transactions in money movements, what activity reports should be reviewed, how patterns of unusual activity were to be detected, or how to investigate unusual activity or red flags.

In addition, the firm’s AML program did not include appropriate risk-based procedures for conducting ongoing customer due diligence, including understanding the nature and purpose of customer relationships for the purpose of developing customer risk profiles and conducting ongoing monitoring to identify and report suspicious transactions and, on a risk basis, maintaining and updating customer information.

The firm also failed to develop complete customer risk profiles or maintain updated customer profile information based on its ongoing monitoring. As a result, the firm did not maintain sufficient customer information necessary to determine whether transactions that were flagged as potentially suspicious were consistent with the nature and purpose of customer relationships or to update customer information upon detecting information relevant to customer risk profiles.

Multiple firm customers engaged in wire transfers without the firm conducting reasonable reviews to detect potential suspicious activity and determine whether suspicious activity reporting (SAR) was required, despite the presence of red flags, including repetitive wire activity in unusual patterns; securities accounts used for payments and outgoing wire transfers with little or no securities activity; and wire transfers from high-risk geographic locations and financial secrecy havens.