AML&CFT Policies and procedures

This Policy relates to our anti-money laundering and countering the financing of terrorism (AML/CFT) policies and procedures. This Policy is solely for the purpose providing general information and is not, in any way, legally binding either on us and/or on any other person(s) (natural or otherwise).

Our Principles and Approach to AML/CFT Efforts

We are committed to supporting AML/CFT efforts, in principle, we are committed to, amongst other things:

exercising due diligence when dealing with our customers, natural persons appointed to act for our customers ‘behalf;
conducting our business in conformity with high ethical standards, and to, as far as possible, guard against establishing any business relations that is or may be connected with or may facilitate money laundering or terrorism financing (ML/TF);
we will, to the fullest extent possible, assist and cooperate with relevant law authorizes to prevent the threat of money-laundering and terrorism-financing.

Our Approach to Risk Assessment and Mitigation

Risk Assessment

We envisage that the majority of our customers would be retail customers, and that we would as of the date of this Policy, be mainly operating in the Republic of Seychelles.

In this regard, we would:

document and/or collect documentation in relation to:
- the identities of our customers;
- the countries or jurisdictions that our customers are from or in.
ensure that, to the best of our knowledge, skill and ability, that our customers, connected persons of a customer, natural persons appointed to act on behalf of a customer, beneficial owners of a customer will be assessed and screened with the assistance of List of Designated Individuals and Entities which include (but are not limited to) the categories such as:
1. as described in Restricted Jurisdiction Policy
2. the UN 1267/1989 Al-Qaida List
3. the UN 1988 Taliban List

Risk Mitigation

If identified, we shall not deal with any persons identified in the List of Designated Individuals and Entities.

Our Approach to New Products, Practices and Technologies

We shall be properly advised, in relation to, identifying and assessing the ML/TF risks that may arise in relation to:

the development of new products and new business practices, including new delivery mechanism;
the use of new or developing technologies for both new and preexisting.

We shall especially pay special attention to any new products and new business practices, including new delivery mechanism, and new or developing technologies, that favor anonymity such as digital tokens (whether security, payment and/or utility tokens) that favor anonymity.

Our Approach to Customer Due Diligence (CDD”)

We do not open, maintain or accept anonymous accounts or accounts in fictitious names.

We do not establish business relations with, or undertake a transaction for a customer that we have any reasonable grounds to suspect that the assets or funds of a customer are proceeds of drug dealing or criminal conduct. We shall lodge a Suspicious Transaction Report and extend a copy to the relevant Financial Intelligence Unit for such transactions.

We perform CDD:

when we establish business relations with any customer;
when we undertake any transaction for any customer whom we had not established business relations with;
when we effect or receive virtual assets by transfer for any customer whom we had not established business relations with;
when we have suspicion of ML/TF;
when we have doubts about the veracity or adequacy of any information.

When we suspect that there are 2 or more transactions are or may be related, linked or the result of a deliberate restructuring of an otherwise single transaction into smaller transactions in order to evade the Prevention of ML/TF measures, we shall treat the transactions as a single transaction and aggregate their values for the purpose of complying with Prevention of ML/TF principles.

Identifying our Customers

We shall identify each of our customers.

To identify our customers, we shall obtain, at least:

their full names, including aliases;
their unique identification numbers (such as an identity card number, birth certificate number, or passport number);
their registration address;
their date of births;
their nationality.

Verifying the Identities of our Customers

We shall verify the identities of our customers using reliable, independent source data, documents or information.

Ongoing Monitoring

We shall monitor business relations with our customers on an ongoing basis. We shall, during the course of business relations with a customer, observe the conduct of the customer’s account and scrutinize transactions undertaken throughout the course of business relations, to ensure that the transactions are consistent with our knowledge of the customer, its business and risk profile and where appropriate, the source of funds.

We shall perform our risk mitigation measures where the transaction involves a transfer of virtual assets to or receipt of virtual assets from an entity other than:

a financial institution;
a financial institution that is subject to and supervised for compliance with AML/CFT requirements consistent with standards set by the FATF.

We shall pay special attention to all complex, unusually large or unusual patterns of transactions, undertaken throughout the course of business relations, that have no apparent or visible economic or lawful purpose. We shall, to the extent possible, inquire into the background and purpose of the aforesaid transactions and document its findings with a view to making this information available to the relevant authorities should the need arise.

For the purposes of ongoing monitoring, we shall put in place and implement adequate systems and processes, commensurate with the size and complexity of the payment service provider to:

monitor its business relations with customers
detect and report suspicious, complex, unusually large or unusual patterns of transactions undertaken throughout the course of business relations.

We shall ensure that the CDD data, documents and information obtained in respect of customers, natural persons appointed to act on behalf of the customers, connected parties of the customers and beneficial owners of the customers, are relevant and kept up-to-date by undertaking reviews of existing CDD data, documents and information, particularly for higher risk categories of customers.

We have a zero-tolerance policy regarding of our clients activity that may resemble illegal, including but not limited to child exploitation, terrorist financing, money laundering, drug trafficking, as well as the use of crypto assets flagged by analytics systems as related to dark markets , sanctions, stolen coins, ransom or scam. Taking into account the identified suspicions regarding clients having connections with these activities, depending on the circumstances, we reserve the right to take the following measures: request for documents on the essence and meaning of economic transactions with a warning temporary blocking of an account from requests for documents about the origin of funds and their sources permanent account blocking with notification to law enforcement agencies and the relevant regulator.

In this case, receiving funds from the account is possible only after a positive response from the regulatory authorities after a comprehensive investigation of suspicions of illegal activities.

We shall implement the policies and procedures when establishing business relations with a customer and when conducting ongoing due diligence.

Where there is no face-to-face contact, the payment service provider shall perform CDD measures that are at least as stringent as those that would be required to be performed if there was face-to-face contact.

Screening

We shall screen a customer, natural persons appointed to act on behalf of the customer, connected parties of the customer and beneficial owners of the customer against relevant ML/TF information sources, as well as lists and information provided by the Authority for the purposes of determining if there are any ML/TF risks in relation to the customer.

We shall screen the persons:

when, or as soon as reasonably practicable after, we establish business relations with a customer;
before we undertake any transaction for any customer who has not otherwise established business relations with the payment service provider;
before we effect or receive virtual assets by value transfer, for a customer who has not otherwise established business relations with us;
on a periodic basis after we establishes business relations with our customers;

when there are any changes or updates to:

the lists and information provided by the Authority to the payment service provider;
the natural persons appointed to act on behalf of a customer, connected parties of a customer or beneficial owners.

We shall screen all value transfer originators and value transfer beneficiaries, against lists and information provided by the Authority for the purposes of determining if there are any ML/TF risks.

We shall document the results of all screening.

Our Approach to Enhanced CDD

Politically Exposed Persons

We shall use all reasonable means to determine if a customer, any natural person appointed to act on behalf of a customer, any connected party of the customer or any beneficial owner of the customer is a politically exposed person, or a family member or close associate of a politically exposed person.

We shall, in addition to performing CDD measures, perform at least the following enhanced customer due diligence (eCDD) measures where a customer or any beneficial owner of the customer is determined by us to be a politically exposed person, or a family member or close associate of a politically exposed person:

obtain approval from senior management to establish and continue business relations with the customer;
establish by reasonable means, the source of wealth and source of funds of the customer and any beneficial owner of the customer;
conduct, during the course of business relations with the customer, enhanced monitoring of the business relations with the customer.

We shall increase the degree and nature of monitoring for any transactions that appear unusual or suspicious.

Higher Risk Categories

We recognize that the following circumstances where a customer presents or may present a higher risk for ML/TF include but are not limited to the following:

where a customer or any beneficial owner of the customer is from or in a country or jurisdiction in relation to which the FATF has called for countermeasures, the payment service provider shall treat any business relations with or transactions for any such customer as presenting a higher risk for ML/TF;
where a customer or any beneficial owner of the customer is from or in a country or jurisdiction known to have inadequate AML/CFT measures, as determined by the payment service provider for itself or notified to payment service providers generally by the Authority or other foreign regulatory authorities, the payment service provider shall assess whether any such customer presents a higher risk for ML/TF.

We will perform enhanced CDD for customer who presents a higher risk for ML/TF or any customer the Authority notify to us as presenting higher risk for ML/TF.

Our Approach to Value Transfer

If we are the ordering institution, before effecting a value transfer, we shall:

identify the value transfer originator and take reasonable measures to verify his or its identity (if we have not already done so);
record adequate details of the value transfer including but not limited to, the date of the value transfer, the type and value of virtual assets) transferred and the value date.

If we are an ordering institution, we shall include in the message or payment instructions that accompanies or relates to the value transfer:

the name of the value transfer originator;
the value transfer originator’s account number (or unique transaction reference number if applicable);
the name of the value transfer beneficiary;
the value transfer beneficiary’s account number (or unique transaction reference number if applicable).

Value Transfers Exceeding a particular threshold

For value transfer exceeding a particular threshold and if we are an ordering institution, we shall identify the value transfer originator and verify his or its identity, include in the message or payment instructions that accompanies or relates to the value transfer information and any of the following:

the value transfer originator’s residential address;
the value transfer originator’s unique identification number;
the date and place of birth, incorporation or registration of the value transfer originator (as may be appropriate).

We shall immediately and securely submit to the beneficiary institution all value transfer originator and value transfer beneficiary information, and shall document all such information. Where we in the capacity as an ordering institution are not able to comply with the requirements, we shall not execute the value transfer.

If we are the beneficiary institution, we shall take reasonable measures to identify value transfers that lack the required value transfer originator or required value transfer beneficiary institution.

For value transfers where we as the beneficiary institution pays out transferred virtual assets in cash or cash equivalent to a value transfer beneficiary, we shall identify and verify the identity of the value transfer beneficiary (if the identity has not been previously verified).

We shall always conduct a review prior to executing a value transfer lacking the required value transfer originator or value transfer beneficiary information, and document our follow-up action.

If we are the intermediary institution, we shall retain all information pertaining to a value transfer.

When we as an intermediary institution effect a value transfer to another intermediary institution or beneficiary institution, we shall immediately and securely provide the information accompanying the value transfer, to that other intermediary institution or beneficiary institution.

If we are a receiving intermediary institution, we shall keep a record for at least five years for all information received from an ordering institution or another intermediary institution.

We shall take reasonable measures to identify value transfers that lack the required value transfer originator or value transfer beneficiary information when straight-through processing.

Record Keeping

We will keep proper records as required for a time period of at least 5 years.

Personal Data

We will safeguard the personal data of our customers in the manner prescribed.

Suspicious Transactions Reporting (STR”)

We will inform the relevant authorities and file STR Reports as required by law. We will also keep all records and transactions relating to all such transactions and STR Reports.

Our Policies on Compliance, Audit and Training

Amongst other things, we shall appoint an AML/CFT Compliance Officer at the Management Level, maintain an independent audit function, and take proactive measures in regularly training our employees and employees on AML/CFT matters.

Enterprise-wide money-laundering/terrorism financing risk assessment

We will employ and enterprise-wide money-laundering/terrorism financing risk assessment in 3 phases:

Phase 1: Assessing inherent risk

We will assess the inherent risk in relation to our:

customer or entity: we will make an assessment in relation to our customers and/or entities we deal with;
product or services: we will and are mindful of who we serve in our virtual assets OTC services;
geographical level: we will not deal with customers from the List of Designated Individuals and Entities.

Phase 2: Assessing mitigating control

We will assess our mitigating controls in relation the aforesaid, any and/or all customer(s) whom we find suspicious will be first monitored, followed by exercising eCDD.

Phase 3: Assessing residual risk

We will assess our residual risks after assessing our mitigating controls.

Crypto Travel Rule

The crypto travel rule is a regulation that requires customer due diligence every time crypto assets are moved. Companies can verify the identities of both the sender and receiver in a transaction, so they can spot red flags. Depending on the guidelines set up, a provider can choose to halt suspicious transactions before they even go through. Our company fully follows these rules and transmits transaction information to financial institutions in accordance with established rules and regulations.

AML/CFT policy

The Company complies with all legal norms relating to interaction with law enforcement authorities in the countries of its presence, including, but not limited to: complete and in-depth answers to incoming requests with the provision of all necessary information, both under court orders and out of court, if the legislation on availability does not oblige to receive a judicial request for information;
blocking of user assets both by court orders and out of court, if the legislation of the place of presence does not oblige receiving a judicial request to seize funds;
transfer of property by court order to government authorities or to victims without payment of compensation to users who have violated the laws of the country of presence;
assistance to law enforcement and other authorized bodies in the investigation of crimes related to cryptocurrencies, as well as information support upon requests;
comprehensive assistance in the return of stolen assets to their rightful owners.

In our activities aimed at ensuring the legality of transactions on the blockchain and the safety of users, in addition to the listed FATF recommendations, we use Federal Law No. 115-FL “On Countering the legalization (laundering) of illegal earnings and the financing of terrorism,” including:

Exchange and P2P platform users identification (KYC);
Wallets and transactions identification (KYT);
Selective Identification of the Fiat funds' origion (Source of funds);
Implementation of procedures, algorithms and policies related to preventing of money laundering and financing of Terrorism (AML/CFT) and continuous development of such procedures, algorithms and policies;
formation and continuous improvement of security and compliance departments, which are also responsible to identify and prevent transactions related to criminal activities, as well as assistance in solving crimes involving transactions on public blockchains;

Special admission procedure of PEP's (politically exposed persons ) to operations on the exchange and P2P platform.

In order to implement the stated principles, we cooperate with KYC/AML providers authorized to process users’ personal data in accordance with the requirements of Federal Law No. 152-FL “On Personal Data”. We carry out KYT analytics both independently (using databases and algorithms for identifying wallets and transactions related to criminal activities) and with the involvement of third-party providers of such services.