UT/2023/000092 - [2024] UKUT 00035 (TCC)

In February 2023, Nvayo was in the process of implementing a remediation plan for AML controls and processes following an annual review by an independent compliance firm FSCom Ltd. Mr Scanlon met with the Authority together with Nvayo’s compliance officer and its directors to discuss the ongoing remediation project and provide additional information to the Authority following an information request by the Authority. Following the receipt of Nvayo’s audit report on 24 July 2023 and its MLRO’s report on 4 August 2023 the Authority decided to undertake its own review of Nvayo’s financial crime systems and controls. In particular, the Authority were concerned with the extent to which Nvayo’s clients’ risk scores had changed upwards.

On 17 October 2023, Nvayo’s solicitors reported Nvayo had been remediating the deficiencies identified by FSCom and that it had already made good progress. The letter also stated that Nvayo had engaged an additional independent compliance consulting firm, to assist with day-to-day compliance support and that additional compliance staff had been recruited and hired with relevant experience of Nvayo’s business activities.

The Authority requested that Nvayo provide copies of ten client files which were provided by Nvayo on 23 October 2023. The files had been selected by the Authority on the basis they were the top clients by transactional volume and/or value data. The Authority then reviewed these files against the relevant regulatory requirements, completing the review on 1 November 2023. The Authority considered every file inadequate, noting issues which included inappropriate risk ratings, lack of client risk assessments and failures to verify identities.