Money Laundering (ML) is the process of creating the appearance that large amounts of money obtained from criminal activity originated from a legitimate source.
To fight against ML, several procedures, law and regulations are designed by government to stop the practise of generating income through illegal actions. These are summarised as AML which is the Anti Money Laundering.
Safi Financial LLC with his product SafiMoney hereinafter called “Company” aims to detect, manage and mitigate the risks associated with money laundering and the financing of terrorism.
The Company has introduced strict policy aimed on the detection, risk prevention or mitigation in respect of any suspicious activities performed by customers.
The Company is required to constantly monitor its level of exposure to the risk of ML and the financing of terrorism.
The Company believes that knowing its client well and understands its instructions and behaviour thoroughly, it will be better placed to assess risks and spot suspicious activities.
2. Customer due diligence
Effective Customer Due Diligence (CDD) measures are essential to the management of money laundering and terrorist financing risk. CDD means identifying the customer and verifying their identity based on collected documents, data or information both during the phase of starting a business relationship with customer and on an ongoing basis.
The customer identification and verification procedures require the collection of data and attempts to verify that data.
During the registration process and while using SafiMoney an individual customer for private use provides the following identification information to the Company:
- Customer’s full name
- Customer’s date of birth
- Country of residence/location of customer
- Mobile telephone number and e-mail
During the registration process and while using SafiMoney a corporate customer for business use provides beside the above for private use the following identification information to his Company:
- Full company name
- Registration number and date/Trade license
- Country of registration/incorporation
- Registered address
- Number of employee
After receiving the identification information, the Company’s staff should verify this information requesting the appropriate documents.
Appropriate documents for verifying the identity of customer include, but are not limited to, the following:
For an individual customer: A high resolution scanned copy or photo of pages of a valid passport or any other valid national ID, indicating family name and name(s), date and place of birth, passport-number, issue and expiry dates, country of issue and Client’s signature.;
For a corporate customer: a high-resolution copy of documents showing the existence of the entity, such as Certificate of Incorporation, and, where applicable, Certificate of Change of Name, Certificate of Good Standing, Articles of incorporation, a government issued business license (if applicable), etc.
To verify proof of address of the customer the Company requires one of the following to be provided, in the same correct name of the customer:
- A high-resolution copy of a utility bill (fixed-line phone, water, electricity) issued within the last 3 months
- A copy of a tax or rates bill from a local authority
- A copy of a bank statement (for a current account, deposit account or credit card account)
- A copy of a bank reference letter
If an existing customer either refuses to provide the information described above or if a customer has intentionally provided misleading information, the Company, after considering the risks involved, will consider closing any of an existing customer’s account.
The Regulations measures require further research and identification of customers who may pose a potentially high risk of money laundering/terrorism financing. If the Company has assessed that the business relationship with a customer pose a high risk it will apply the following additional measures:
- Obtaining the information relating to the source of the funds or the wealth of the customer will be required (this will be done via e-mail or phone)
- Seek further information from the customer or from Company’s own research and third-party sources in order to clarify of update the customer’s information, obtain any further or additional information, clarify the nature and purpose of the customers transactions with Company
When obtaining information to verify the customer’s statements about source of funds or wealth, the Company’s staff will most often ask for and scrutinise details of the person’s employment status or business/occupation. The Company’s staff will ask for whatever additional data or proof of that employment/occupation that may be deemed necessary in the situation, particularly the appropriate confirming documents (employment agreements, bank statements, letter from employer or business, etc.).
The Company will conduct ongoing customer due diligence and account monitoring for all business relationships with customers. It particularly involves regularly reviewing and refreshing Company’s view of what its customers are doing, the level of risk they pose, and whether anything is inconsistent with information or beliefs previously held about the customer. It can also include anything that appears to be a material change in the nature or purpose of the customer’s business relationship with Company.
3. SafiMoney Compliance Officer’s responsibilities
The Company compliance officer’s responsibilities include:
- Ensuring the Company’s compliance with the requirements of the Regulations
- Establishing an audit function to test its anti-money laundering and combating the financing of terrorism procedures and systems
- Training employees to recognize suspicious transactions
- Receiving and investigating internal suspicious activity and transaction reports from staff and making reports to the Financial authorities where appropriate
- Obtaining and updating international findings concerning countries with inadequate SafiMoney systems, laws or measure
All Company employees, managers and directors must be aware of this policy. Employees, managers and directors who are engaged in SafiMoney related duties must be suitably vetted.
This includes a criminal check done at the time of employment and monitoring during employment. Any violation of this policy or an SafiMoney program must be reported in confidence to the SafiMoney Compliance Officer, unless the violation implicates the SafiMoney Compliance Officer, in which case the employee must report the violation to the Chief Executive Officer. Employees who work in areas that are susceptible to money laundering or financing terrorism schemes must be trained in how to comply with this policy or the SafiMoney program. This includes knowing how to be alert to money laundering and terrorism financing risks and what to do once the risks are identified.
4. Development of internal regulatory documents
To fulfil this policy, the Company continuously elaborates internal regulatory documents.
These internal regulatory documents determine duties and responsibility of the Company’s structural units and employees, as well as regulates specific actions. The Company independently improves its internal regulatory documents pursuant to legal acts of the international requirements in preventing the Company risk.
Introduction of Customer Due Diligence activities is aimed at equipping the Company with authentic and properly documented data about the customer, their authorized representatives, and beneficial owners.
Depending on the risk degree, the Company investigates specifics on activity, origin of funds turning over on the Company’s electronic money accounts, and the essence of transactions.
To achieve that, the internal regulatory documents determine:
Customer identification procedure (when, in what situations, and how the Company obtains and verifies each customer’s identity – initial, repeated, and current identification; additional caution measures for authentication of the customer’s identity data when establishing business relations with a customer who does not visit the Company in person (non face-to-face customers), procedure for accepting and processing identification documents, etc.); Procedure for determining customer SafiMoney risk (investigation of determining possible SafiMoney risk and adverse consequences, general principles for determining customer SafiMoney risk and due diligence (risk management, identification, and customer residence (registration) country risk, (legal form and business type), products / services risk, risk-based customer due Diligence.
Customer due diligence procedure (risk profile and exceptions resulting therefrom for form and business type), products / services risk, risk-based customer due application of due diligence; customer due diligence prior to establishing business relations (decision making on establishment of business relations); customer due diligence during business relations (customer due diligence and responsibility for conduction thereof, applicable due diligence actions (including cooperation with other structural units);
Enhanced customer due diligence procedure; enhanced due diligence during business relations (customers who are subject to enhanced due diligence; actions to be taken enhanced due diligence provisions; precaution actions towards customers who undergo enhanced due once; control and monitoring of the due diligence conducted by executive employees; identifying beneficial owners; requesting documents and customer explanations describing specifics of their economic activity; control actions to verify the customer’s provided information, etc.);
The Company determines methods used to detect a politically exposed persons (PEP), risk- based approach to investigating a PEP’s personal activity and ongoing monitoring; terminating business relations with the customer (decision making on terminating with balances on the customer’s accounts).
Requirements to store documents and information are aimed at determining a procedure for storing data and documents obtained through customer identification and due diligence, as well as data and documents obtained through customer transaction monitoring.
The reporting obligation applies to cases when the Company has to inform certain state institutions of unusual transactions and suspicious facts if the Company has reasonable concerns that money laundering or terrorist financing has been attempted or has or is taking place. For this purpose, internal regulatory documents determine the following reporting procedure:
- to public institutions
- to the Company’s Board regarding AML risk management results, actions taken to prevent responsibility; agent activity monitoring principles; procedure and reasons for terminating business relations
- The internal regulatory documents also regulate
- use of agents in attraction of customers (agent selection criteria, agents’ rights, duties, and responsibility; agent activity monitoring principles; procedure and reasons for terminating business relations)
- training of the Company’s executive employees and testing their knowledge of SafiMoney risk prevention
5. Data processing
The Company understands that the technical equipment and systems at its disposal should ensure analysis of customers’ transactions in the SafiMoney risk prevention process to identify suspicious financial transactions, as well as application of the Office of Foreign Assets Control (OFAC) and other filters and creation of the report database.
As to processing of data obtained in the SafiMoney and terrorist financing prevention process, the Company ensures gradual transition to application of an automated system that would provide a comprehensive information volume about customers and updates thereof.