- Appian Asset Management breached client asset, AML, and fitness, probity rules.
- The firm’s historic regulatory failures left it exposed to cyber-fraud by third party.
- Acting on instructions of fraudster impersonating client, it facilitated transactions.
- Over two-month period no one at Appian suspected fraud, AML, terror financing.
- Mar. 2015, businessperson (real client) invested €1mn in two managed sub-funds.
- In Apr. 2015, a cyber-fraudster (fake client) hacked real client’s web-based email.
- Impersonated him in protracted series of email correspondence with an employee.
- Failure resulted in client losing €650k in funds and has now been fully reimbursed.
- Firm has remediated its failings, and complied with CBOI Risk Mitigation Program.