Vaultex logotype

Anti-Money Laundering and Countering the Financing of Terrorism Policy

We are committed to providing a secure and reliable platform for our users to conduct their transactions eortlessly. In line with this commitment, we have established an Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) Policy, hereinafter referred to as the “Policy” for preventing and mitigating the risks associated with money laundering and terrorist financing, which applies to all our operations, including those of our subsidiaries and aliates. In this regard, we would like to draw your attention to the applicability of this policy to the following entities (collectively “we”, “us”, “our” or “Vaultex Ltd”.);

We acknowledge the signicance of adhering to the anti-money laundering and counter-terrorism financing (AML/CFT) regulations and legislations applicable to the regions where we conduct our operations. Our policy outlines the proactive steps taken to recognize, alleviate, and control the risks linked with money laundering and terrorist financing. Our dedication is unwavering in maintaining these benchmarks, and we arm that our platform will not be utilized for any illicit activities.

We appreciate your ongoing condence in our platform and our pledge to uphold the utmost levels of compliance and security standards.

1. Introduction

    Criminals and terrorists exploit financial institutions and systems to conceal, transfer, and legitimize illicit funds, creating challenges in tracing and seizing their unlawful proceeds. Money laundering and the funding of terrorism pose substantial risks to the stability and credibility of the worldwide nancial system. In response to these threats, numerous nations have introduced Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT) policies, outlining precise measures and obligations to prevent, identify, and report activities related to money laundering and terrorism financing.

    a) Purpose of the policy

    The primary objective of our AML Policy is to establish a robust framework that protects our operations from being used for illicit nancial activities. We are committed to preventing money laundering and the financing of terrorism by adhering to rigorous regulatory standards, fostering transparency, and instilling a culture of diligence and vigilance within our organization. Additionally, our policy is designed to ensure full regulatory compliance, aligning with international and local standards to maintain the integrity of our nancial systems and contribute to global eorts against nancial crimes.

    b) Scope of the policy

    Vaultex AML/CFT Policy applies comprehensively to all operations, subsidiaries, and aliates. This policy applies to all jurisdictions where we operate, ensuring compliance with the AML/CFT regulations of each region. The AML/CFT measures outlined in this policy are applicable to all customer relationships, account types, and transactions.

    This policy covers all employees, contractors, and relevant stakeholders, ensuring that they receive regular training and awareness initiatives related to AML/CFT regulations, internal policies, and procedures. The reporting obligations and criteria for suspicion specied in the policy apply to all employees and stakeholders involved in operations, emphasizing a comprehensive and proactive reporting culture.

    The commitment to continuous improvement is ingrained in the policy, emphasizing adaptability to emerging risks, regulatory changes, and evolving nancial crime trends. The policy's reach ensures a holistic and consistent approach to combating money laundering and terrorist financing across the entire organization.

2. Regulatory Framework

    a) Legal compliance

    Vaultex commits to comply with all relevant national and international AML/CFT laws and regulations. This includes adherence to guidelines provided by regulatory bodies such as the Financial Action Task Force (FATF) and local regulatory authorities.

    This AML policy is established in compliance with the Anti-Money Laundering Regulations, 2011, and the Anti-Terrorism (Prevention of Terrorist Financing) Regulations 2011 of Nevis, forming the legal foundation for combating money laundering and terrorist financing activities within the jurisdiction.

    b) Voluntary Adoption

    The Anti-Money Laundering Directives (AMLD) stand as crucial regulations within the European Union (EU), designed to prevent nancial systems' misuse for money laundering and terrorism financing. Among these directives, AMLD 5 and 6, the most recent, aim to bolster the EU's framework by introducing requirements such as risk-based approaches and enhanced due diligence measures. In its dedication to regulatory compliance, Vaultex has voluntarily embraced AMLD 5 and 6 regulations. This proactive adoption brings various benets, including an improved reputation, enhanced risk management, better protection for stakeholders, future-proong against regulatory changes, and increased eciency in implementing AML/CFT measures. By aligning with these directives, Vaultex showcases a steadfast commitment to the highest standards of regulatory compliance and a proactive stance against nancial crimes.

    c) Commitment to Regulatory Updates:

    Our Company acknowledges the dynamic nature of regulatory landscapes governing Anti-Money Laundering (AML) and Counter-Terrorism Financing (CTF) activities. We commit to staying abreast of amendments, revisions, or additions to relevant regulatory laws, ensuring our AML policy remains current and aligned with the latest legal requirements.

    c) Legal Consequences

    Vaultex acknowledges the gravity of money laundering and terrorism financing oenses and recognizes the legal consequences that may follow. Individuals found guilty may face legal action, including criminal charges, fines, and imprisonment as determined by the competent authorities.

3. Risk Assessment

    Risk assessment is a dynamic and integral part of our AML/CFT framework. Our risk assessment process is designed to be comprehensive, adaptive, and proactive in identifying, evaluating, and mitigating potential AML/CFT risks associated with our operations including subsidiaries and affiliates.

    a) Risk Based Approach

    Our company adopts a risk-based approach as a fundamental pillar of our AML/CFT framework. This approach emphasizes a nuanced and tailored response to the varying degrees of risk associated with different aspects of our operations. To implement the risk-based approach effectively, we conduct thorough risk profiling, assessing the inherent risks associated with customers, products, services, geographic locations, and delivery channels. This process enables us to categorize these elements into different risk levels based on their susceptibility to money laundering and terrorist financing

    b) Risk Profiling

    To implement the risk-based approach effectively, we conduct thorough risk profiling, assessing the inherent risks associated with a range of factors such as the nature, scale, and complexity of our operations, diversity of products and services, geographic locations, jurisdictions of operation, customer profiles, and types of transactions. This process enables us to categorize these elements into different risk levels based on their susceptibility to money laundering and terrorist financing

    Our risk assessment process follows a systematic and thorough methodology to ensure a holistic understanding of the risks involved:

    • We identify and catalog potential risks associated with money laundering and terrorist financing.

    • Inherent risks are categorized into different levels based on the factors mentioned above.

    • We employ both quantitative and qualitative analyses to assess the magnitude and nature of identified risks.

    • Scenarios and predictive modeling help anticipate potential risks and their likely impact on our institution.

    • Our risk assessment benefits from expert input within our institution and utilizes industry data to stay informed about emerging risks.

    By delving into specific factors and outlining the step-by-step process, we ensure transparency and demonstrate our commitment to a robust risk-based methodology.

    c) Cross-Border Risk Mitigation

    We conduct a comprehensive risk assessment specific to each jurisdiction in which we operate to identify and evaluate potential AML/CFT risks. The assessment takes into account local regulations, political stability, economic conditions, and other relevant factors. We conduct in-depth analyses of the regulatory frameworks, legal environments, and geopolitical conditions in each jurisdiction where we operate. Early identification and analysis of geopolitical risks allow us to implement timely risk mitigation measures

    d) Tech-driven Risk vigilance

    We will leverage advanced technologies for transaction monitoring, customer due diligence, and risk assessment. Also, we recognize the influence of emerging technologies on AML/CFT risks. Our risk assessment incorporates ongoing evaluations of new technologies and their implications on risk exposure.

    e) Proactive Approach

    Our Company is dedicated to proactively managing risks by staying ahead of emerging threats. The risk assessment will be dynamic and ongoing, adapting to changes in our business landscape. The risk-based approach aligns with our commitment to continuous improvement. Regular reviews and evaluations of our risk assessment methodologies and outcomes allow us to refine and enhance our AML/CFT policy, ensuring they remain effective against evolving threats.

    f) Ongoing risk assessment

    Risk is not static, and our company acknowledges the dynamic nature of threats associated with money laundering and terrorist financing. Our risk-based approach includes ongoing risk assessments, ensuring that our AML/CFT policy evolves in response to changes in the internal and external environment. The risk assessment process will be dynamic, with ongoing monitoring and periodic reviews to adapt to changes in the operating environment, emerging risks, or modifications in the bank's business model. Regular reviews will ensure the effectiveness of mitigation measures and the relevance of risk ratings.

4. Governance and Oversight

    In our unwavering commitment to maintaining the highest standards of integrity and compliance, this Governance and Oversight Clause outlines the key mechanisms and roles within our organization for AML/CFT governance.

    a) Board Oversight

    With a focus on transparency, accountability, and proactive risk management, our Board of Directors assumes a central role in overseeing AML/CFT compliance. They are committed to conducting regular reviews of policy effectiveness, aligning strategies with regulatory requirements, and receiving periodic reports on compliance status and risk assessment. They will ensure the allocation of sufficient resources to uphold and continuously enhance the effectiveness of the AML/CFT program.

    b) Designated Compliance Officer

    A designated Compliance Officer is appointed, acting as a central figure responsible for day-to-day policy implementation, monitoring, enforcing compliance, conducting risk assessments, and fostering stakeholder liaison. This officer also conducts ongoing training programs for staff to enhance awareness and competence in AML/CFT matters.

    c) Internal Control Framework

    Our company will establish and maintain a comprehensive internal control framework to support the AML/CFT program. This framework will include clearly defined policies and procedures, segregation of duties, regular internal audits, and ongoing training programs. The internal control framework will be subject to periodic reviews and adjustments to address emerging risks and evolving regulatory requirements.

    d) Stakeholder Communication

    Effective stakeholder communication is established through reporting channels for suspicious activities, collaboration with law enforcement and regulatory bodies, and regular updates to employees, customers, and other stakeholders on AML/CFT policies.

    e) Documentation and Record-Keeping

    Within our organizational framework, we prioritize transparency and accountability through robust documentation and record-keeping practices. This entails:

    • Robust documentation and record-keeping practices to ensure transparency and accountability.

    • Records maintained for customer due diligence, transaction monitoring, and suspicious activity reporting.

    • Regular internal and external audits of documentation processes to ensure compliance and accuracy.

    • Secure storage of records to protect sensitive information from unauthorized access.

    This multifaceted strategy reflects our dedication to maintaining the highest standards of data security, operational excellence, and ethical conduct in all our endeavors.

5. Suspicious Activity Reporting (SAR)

    This Suspicious Activity Report (SAR) clause is integral to our AML/CFT policy, emphasizing the importance of identifying and reporting any activities that may indicate potential involvement in money laundering, terrorism financing, or other illicit financial practices.

    a) Reporting Obligations

    All employees, contractors, and relevant stakeholders are obligated to promptly report any transactions, behaviors, or patterns that arouse suspicion or deviate from the norm. The obligation extends to transactions involving all operations of Vaultex, emphasizing our commitment to comprehensive AML measures.

    b) Criteria for Suspicion

    Suspicious activities include but are not limited to: -

    • Transactions inconsistent with the customer's known profile.

    • Unexplained large transactions.

    • Complex transactions with no apparent economic or legal purpose.

    • Patterns of transactions designed to evade reporting requirements.

    • Transactions involving high-risk jurisdictions or entities.

    • Any activity indicating potential involvement in fraud, bribery, corruption, or other financial crimes.

    c) Reporting Procedure

    Reports should be submitted to the designated Reporting Officer, who serves as the focal point for collecting and assessing information related to suspicious activities. The Reporting Officer will conduct a thorough analysis, taking into account all relevant details provided in the report.

    d) Escalation and Communication

    The Reporting Officer, upon validating the suspicion, will escalate the matter to the appropriate internal and external authorities, including the Financial Intelligence Unit (FIU) if required.

    Communication channels will be established to ensure swift and confidential reporting, fostering a culture of transparency.

    Any reports or disclosures required by regulatory authorities will be submitted promptly and in accordance with regulatory requirements.

    We will cooperate fully with regulatory authorities in any investigations related to AML/CFT compliance.

    e) Third Party Reporting obligation

    Where Vaultex engages with the third-party service providers for specific functions, these third-party entities are contractually obliged to promptly report any suspicious activities, policy breaches, or non-compliance issues directly to our designated Reporting Officer.

    f) Whistleblower Protection

    Vaultex places paramount importance on the protection of whistleblowers, ensuring their safety and security throughout the reporting process. A confidential reporting mechanism has been instituted to empower employees to voice concerns or suspicions regarding AML/CFT matters without apprehension. This mechanism ensures the anonymity of whistleblowers, fostering an environment where individuals feel secure in bringing forth information. Furthermore, we assure non-retaliation against any employee who reports concerns or suspicions in good faith.

    g) Record-Keeping

    Comprehensive records of all SARs, including the nature of the suspicion, actions taken, and outcomes, will be maintained securely. Regular internal and external audits will ensure the accuracy and compliance of the SAR process.

6. Training and Awareness

    Vaultex is committed to maintaining a well-informed and vigilant workforce in matters of AML and CFT. It establishes a comprehensive framework that addresses onboarding, ongoing training, reporting mechanisms, and continuous improvement, reinforcing a culture of compliance across all levels of the organization.

    a) Training Programs

    Regular training programs, tailored to the roles and responsibilities of employees, will be conducted. The training sessions will cover the latest developments in AML/CFT regulations, internal policies, and procedures. Employees will be educated on recognizing red flags, conducting due diligence, and reporting suspicious activities.

    AML/CFT training will be an integral component of the onboarding process for all new employees. This ensures that every staff member is equipped with the necessary knowledge and skills from the outset.

    Specific attention will be given to employees in high-risk roles, emphasizing their crucial role in the AML/CFT framework. This includes but is not limited to customer-facing roles and those involved in transaction monitoring.

    b) Ongoing Awareness Initiatives:

    Vaultex is dedicated to the continuous improvement of its AML/CFT training programs. Feedback from employees, regulatory updates, and emerging threats will inform adjustments to the training curriculum. Regular evaluations of the training framework will be conducted to measure effectiveness, address gaps, and align with industry best practices

    Regular communication channels will be established to disseminate relevant AML/CFT updates, regulatory changes, and emerging trends. This ensures that employees stay abreast of the evolving landscape. Periodic refresher courses will be conducted to reinforce key concepts and address any identified areas of improvement.

7. Sanction Compliance

    Vaultex is committed to strict compliance with all applicable international and local sanctions, including those imposed by the United Nations, the United States, the European Union, and other relevant authorities.

    a) Screening Processes

    We commit to implementing processes to screen customers and transactions against international sanctions lists and watchlists. Our Screening mechanism includes :

    • Continuous, real-time monitoring of customer transactions

    • Incorporating sanctions compliance into our Customer Due Diligence (CDD) processes, to develop a comprehensive customer risk profiling system.

    • Applying Enhanced Due Diligence (EDD) measure when dealing with high-risk customers

    • Use of advanced technological tools to enhance the accuracy and efficiency

    Sanctions screening procedures will be regularly updated to incorporate changes in sanctions lists and regulatory requirements.

    b) Compliance Checks

    Vaultex treats any violation of sanctions compliance measures with utmost seriousness, and takes prompt corrective actions, including disciplinary measures. The company will cooperate fully with relevant authorities in the event of any investigations related to sanctions violations. Regular checks will be conducted to ensure compliance with sanctions regulations, and immediate action will be taken to rectify any identified non-compliance.

8. Third-party Oversight

    a) Due Diligence on Third Parties

    Prior to entering into any third-party relationships, Vaultex will conduct thorough due diligence on prospective partners, ensuring alignment with our AML/CFT policy. The due diligence process will encompass an assessment of the third party's AML/CFT controls, reputation, and regulatory compliance and an understanding of the nature of services they provide.

    b) Monitoring and Reporting

    Vaultex establishes continuous monitoring of third-party activities to promptly identify and address any potential AML/CFT risks associated with their services. We retain the right to reassess the third party's AML/CFT controls in response to changes in regulatory requirements or shifts in the risk landscape.

    We place a robust reporting mechanism for employees to report any concerns or suspicions related to the AML/CFT practices of third-party entities.

    c) Audit and Assessment

    Periodic audits and assessments of third-party AML/CFT controls shall be conducted to verify ongoing compliance. Results of audits will be communicated to relevant stakeholders, and corrective actions will be implemented promptly.

9. Cross Border Operations

    Our AML/CFT Policy recognizes the distinctive challenges presented by cross-border operations and is committed to ensuring compliance with relevant laws and regulations in all jurisdictions where we conduct business. The Key Components are as follows:

    a) Regulatory Adherence

    Vaultex pledge to adhere to the AML/CFT regulations of each jurisdiction where we operate, fostering a culture of strict compliance. Collaborative engagement with regulatory bodies in different regions to ensure alignment with local requirements.

    b) Cross-Border Risk Mitigation

    Acknowledging the diverse risk landscapes across borders, our risk management strategies are customized to the specific characteristics of each jurisdiction. The risk assessment process considers regional variations to ensure effective risk mitigation. We apply Enhanced Due Diligence (EDD) measures globally, considering the unique risks associated with cross-border transactions.

    c) Transparent Reporting

    Transparent reporting to regulatory bodies in each jurisdiction is a cornerstone of our cross-border operations. Clear communication and cooperation with regulatory authorities foster mutual trust and demonstrate our commitment to AML/CFT compliance.

    d) Legal and Regulatory Updates

    Our operations are informed by regular updates on legal and regulatory changes in each jurisdiction. Proactive measures are taken to adapt our AML/CFT practices to evolving regulatory landscapes, ensuring up-to-date compliance

10. Policy Review

    The AML/CFT Compliance Officer initiates the review process based on the predetermined schedule or triggers such as regulatory changes, emerging financial crime trends, or significant internal modifications. In addition to scheduled reviews, this policy will undergo triggered reviews in response to significant changes in the regulatory environment, emerging financial crime trends, or internal structural modifications. The process involves several key steps:

    • The AML Compliance Officer will engage with relevant stakeholders, including legal and compliance experts, to gather insights during the review process.

    • Outcomes from policy reviews will inform the adaptation of staff training programs.

    • The outcomes of the review, including proposed policy amendments, are meticulously documented

    • A communication plan is devised to promptly communicate policy changes to all relevant stakeholders. This includes internal staff, management, and other parties impacted by the AML policy

    The review process is not a one-time event but part of an ongoing continuous improvement loop. Insights gained from the review contribute to a culture of continuous enhancement, allowing us to stay ahead of emerging risks and regulatory expectations.

11. Conclusion

    Our dedication to AML/CFT compliance serves as the bedrock of our corporate values, reflecting our unwavering commitment to ethical financial practices. The principles articulated in this policy underscore our proactive stance in combating money laundering and terrorist financing. As custodians of financial integrity, we recognize the dynamic nature of regulatory landscapes and pledge to adapt continuously.

    Beyond regulatory adherence, this commitment is integral to our identity, instilling trust in stakeholders. Moving forward, we embrace the imperative of continuous improvement, staying abreast of emerging risks and evolving regulatory frameworks. Our collective efforts contribute not only to our own ethical standing but also to the broader global endeavor against financial crime. By upholding these principles, we reinforce the resilience of the financial system and uphold our responsibility to society.