The German Federal Financial Supervisory Authority (BaFin) has ordered Instinet Germany GmbH, headquartered in Frankfurt am Main, to rectify extensive deficiencies in its anti-money laundering and terrorist financing prevention measures.

Several audits revealed that the business organization was not functioning properly in the areas examined. Deficiencies were found, among other things, in risk analysis, the appointment of an anti-money laundering officer, customer onboarding, customer risk assessment, and the fulfillment of enhanced customer due diligence obligations.

The institution thus violated the provisions of the German Securities Institutions Act (WpHG) and the German Money Laundering Act (GwG). BaFin ordered the supervisory action because the institution’s own corrective action plans had proven unsuccessful.

If BaFin concludes that an institution’s business organization has deficiencies, it can take action. BaFin can require the institution to rectify the deficiencies within a specified period to ensure proper business organization in the future. BaFin can also order the institution to report regularly on the progress of rectifying the deficiencies.

BaFin has ordered these measures against Instinet Germany GmbH.

The orders are based on Section 51 Paragraph 2 Sentence 1 of the German Money Laundering Act (GwG) and Section 5 Paragraph 4 Sentence 1 of the German Securities Trading Act (WpIG).