The Guernsey Financial Services Commission has imposed a fine of £175,000 on ITI Trade Ltd. and £35,000 on Alex Phil (formerly known as Alexei Filatov, Date of Birth 2 February 1966). The company was incorporated in Guernsey in October 2014 and was granted a license to engage in restricted activities, such as promoting investments.
ITI Trade Ltd. offered execution-only and prime brokerage services to a limited number of clients. The company did not directly interact with its clients, as it operated on an outsourced model. It outsourced almost all of its operations to external service providers, particularly to its sister company in Russia, which provided the company with infrastructure and operational support.
Additionally, the Russian sister company also provided the company’s high-volume algorithmic trading clients with direct market access to the Moscow Stock Exchange.
The commission found that ITI Trade Ltd. was pretending to provide investment services from Guernsey, but in reality, the majority of its business was conducted in Russia. ITI Trade Limited had limited knowledge of its customers and failed to effectively monitor the service providers it outsourced.
During the investigation, it was revealed that the Russian company had not implemented procedures to identify and verify customers, as well as screen them for adverse media and sanctions, until March 2022. These procedures did not meet the standards required in Guernsey.
