1. GENERAL DEFINITIONS
1.1. For the purposes of this Manual, unless the context shall prescribe otherwise:
1.1.1. 'Financial Intelligence Unit' means the FIU of Seychelles.
1.1.2. 'Beneficial Owner' means the natural person or natural persons, who ultimately own or control the Client and/or the natural person on whose behalf a transaction or activity is being conducted. The Beneficial Owner shall at least include:
1.1.2.1. In the case of corporate entities:
1.1.2.1.1. the natural person or natural persons who ultimately own or control a legal entity through direct or indirect ownership or control of a sufficient percentage of the shares or voting rights in that legal entity, including through bearer share holdings; a percentage of 10% or more of the shares or voting rights shall be deemed sufficient to meet this criterion;
1.1.2.1.2. the natural person or natural persons who otherwise exercise control over the management of a legal entity.
1.1.2.2. In the case of legal entities, such as foundations, and legal arrangements, such as trusts, which administer and distribute funds:
1.1.2.2.1. where the future beneficiaries have already been determined, the natural person or natural persons who are the beneficiaries of 10% or more of the property of a legal arrangement or entity;
1.1.2.2.2.where the individuals that benefit from the legal arrangement or entity have not yet been determined, the class of persons in whose main interest the legal arrangement or entity is set up or operates;
1.1.2.2.3.the natural person or natural persons who exercise control over 10% or more of the property of a legal arrangement or entity.
1.1.3. 'Business Relationship' means a business, professional or commercial relationship which is connected with the professional activities of the Company and which was expected, at the time when the contact was established, to have an element of duration.
1.1.4. 'Client' means any legal or physical person aiming to conclude a Business Relationship or conduct a single transaction with the Company. Counterparties are also treated as Clients only when the Company is executing a Client order by entering into a private Over-the-Counter deal or transaction (e.g. buying and selling) directly with the Counterparty.
1.1.5. 'Company' means Keytech Limited, incorporated in the Republic of Seychelles with registration number 8430672-1.
1.1.6. 'Licensed Services' means the services for which the Company holds a Securities Dealer Licence issued by the Financial Services Authority of Seychelles (FSA), including dealing in securities as principal or agent.
1.1.7. 'Manual' means the Company's Prevention of Money Laundering & Terrorist Financing Manual (this manual).
1.1.8. 'Money Laundering and Terrorist Financing Offences or Prescribed Offences' means the offences as defined under the Anti-Money Laundering and Countering the Financing of Terrorism Act, 2020 (as consolidated and amended). 'Laundering Offences' (or Money Laundering offences as known internationally) means the offences as defined under the Anti-Money Laundering and Countering the Financing of Terrorism Act, 2020 (as consolidated and amended).
1.1.8.1. For reference:
Section 3(1) of the Anti-Money Laundering and Countering the Financing of Terrorism Act, 2020: A person is guilty of Money Laundering if, knowing or believing that property is or represents the benefit from criminal conduct or being reckless as to whether the property is or represents such benefit, the person, without lawful authority or excuse (the proof of which shall lie on him) —
- converts, transfers or handles the property, or removes it from the Republic;
- conceals or disguises the true nature, source, location, disposition, movement or ownership of the property or any rights with respect to it; or
- acquires, possesses or uses the property.
1.1.8.2. Money Laundering is viewed as an extremely serious, extraditable, offence. Individuals are liable on conviction in Seychelles to substantial fines and terms of imprisonment as prescribed by the AML/CFT Act 2020. The Company and its officers should refer to the current provisions of the Act for applicable penalties.
1.1.9. 'Law' means the Anti-Money Laundering and Countering the Financing of Terrorism Act, 2020 (Act 5 of 2020) (as consolidated and amended), together with the Anti-Money Laundering and Countering the Financing of Terrorism Regulations, 2020 (as amended), the Beneficial Ownership Act, 2020 (as amended), and the Prevention of Terrorism Act, 2004 (as amended).
1.1.10. 'Occasional Transaction' means any transaction other than a transaction carried out in the course of an established Business Relationship formed by a person acting in the course of financial or other business.
1.1.11. 'Other Business Activities' includes the following trust services and company services to third parties:
1.1.11.1. forming companies or other legal persons;
1.1.11.2. acting as or arranging for another person to act as a director or secretary of a company, a partner of a partnership or a similar position in relation to other legal persons;
1.1.11.3. providing a registered office, business address, correspondence or administrative address and other related services for a company, a partnership or any other legal person;
1.1.11.4. acting as or arranging for another person to act as a trustee of an express trust or a similar legal arrangement;
1.1.11.5. acting as or arranging for another person to act as a nominee shareholder for another person.
1.1.12. 'Politically Exposed Persons (PEPs)' means the natural persons who are or have been entrusted with prominent public functions in the Republic or in another country and their immediate family members and persons known to be close associates.
1.1.13. 'Republic' means the Republic of Seychelles.
1.1.14. 'Regulated Market' means the multilateral system managed or operated by a market operator and which brings together or facilitates the bringing together of multiple third-party buying or selling interests in financial instruments.
1.1.15. 'Shell Bank' means a credit institution or an institution engaged in equivalent activities incorporated in a jurisdiction in which it has no physical presence, involving meaningful mind and management, and which is unaffiliated with a regulated financial group.
2. INTRODUCTION
2.1. The purpose of the Manual is to lay down the Company's internal practice, measures, procedures and controls relevant to the prevention of Money Laundering, Terrorist Financing and Proliferation Financing.
2.2. The Manual is developed and periodically updated by the Compliance Officer (hereinafter the 'CO') based on the general principles set up by the Company's Board of Directors (hereinafter the 'Board') in relation to the prevention of Money Laundering, Terrorist Financing and Proliferation Financing. All amendments and/or changes of the Manual must be approved by the Board.
2.3. The Manual shall be communicated by the CO to all the employees of the Company that manage, monitor or control in any way the Clients' transactions.
2.4. The Manual has been prepared to comply with the provisions of the Law, and the guidelines of the Financial Services Authority of Seychelles (FSA) and the FIU.
3. MANUAL APPLICABILITY: SECURITIES DEALING TRANSACTIONS (INCLUDING CONTRACTS FOR DIFFERENCE)
3.1. The Manual applies to all types of Licensed Services offered by the Company to its Clients, as well as all related dealings, including dealing in securities as principal or agent and the offering of Contracts for Difference (CFDs) and other derivatives.
3.2. In this respect, the CO shall be responsible to update the Manual so as to comply with FSA's future requirements, as applicable, regarding the Client identification and due diligence procedures which the Company must follow, for Clients who engage in securities dealing transactions, including Contracts for Difference (CFDs) and other derivatives.
4. THE RESPONSIBILITIES OF THE BOARD OF DIRECTORS
4.1. The responsibilities of the Board in relation to the prevention of Money Laundering, Terrorist Financing and Proliferation Financing include the following:
4.1.1. to determine, record and approve the general policy principles of the Company in relation to the prevention of Money Laundering, Terrorist Financing and Proliferation Financing and communicate them to the CO;
4.1.2. to appoint a senior official that possesses the skills, knowledge and expertise relevant to financial and other activities depending on the situation, who shall act as the CO;
4.1.3. to approve the Manual;
4.1.4. to ensure that all requirements of the Law are applied, and assure that appropriate, effective and sufficient systems and controls are introduced for achieving the above;
4.1.5. to ensure that the CO and their assistants, if any, and any other person who has been assigned with the duty of implementing the procedures for the prevention of Money Laundering, Terrorist Financing and Proliferation Financing (i.e. personnel of the Back-Office Department), have complete and timely access to all data and information concerning Clients' transactions;
4.1.6. to ensure that all employees are aware of the person who has been assigned the duties of the CO, as well as their assistants (if any), to whom they report, and activities for which they are responsible;
4.1.7. to establish a clear and quick reporting chain based on which information regarding suspicious transactions is passed without delay to the CO either directly or through an assistant;
4.1.8. to ensure that the CO Department has sufficient resources, including competent staff and technological equipment, for the effective discharge of their duties;
4.1.9. to assess and approve the CO's Annual Report of Section 7 of the Manual and take all action as deemed appropriate under the circumstances to remedy any weaknesses identified;
4.1.10. to implement adequate and appropriate systems and processes to detect, prevent and deter Money Laundering arising from serious tax offences;
4.1.11. to ensure that the Company's officials do not knowingly aid or abet clients in committing tax offences.
Resident Staffing Requirements
4.2. Pursuant to the Securities (Amendment) Act 2024 (Act 18 of 2024, in force 27 November 2024) and S.I. 119 of 2024 (in force 31 December 2024), the Company shall comply with the following resident staffing requirements:
4.2.1. Minimum resident personnel: the Company shall at all times maintain at least two resident fit and proper individuals in Seychelles. Such individuals must hold the position of director, compliance officer, or managerial staff of the Company. For these purposes, 'fit and proper' shall be assessed in accordance with the Standards of Conduct under the Securities Act (as amended by the Securities (Amendment) Act 2024).
4.2.2. Resident director: at least one director of the Company must be a resident person employed on a full-time basis. A 'resident person' for the purposes of this Section means an individual who is residing and domiciled in Seychelles, or who is physically present in Seychelles for a period of 183 days or more in any 12-month period.
4.2.3. Complaints handling: the Company shall designate a resident person to undertake the handling of Client complaints. This individual must be physically present in Seychelles and accessible to Clients and to the FSA.
4.2.4. Transitional provision: existing licensees who did not satisfy the residency requirements introduced by the Securities (Amendment) Act 2024 as at the date of that Act's commencement (27 November 2024) shall have until 30 June 2026 to achieve full compliance with the requirements set out in sub-paragraphs (a), (b), and (c) above.
5. OBLIGATIONS OF THE INTERNAL AUDITOR
5.1. The following obligations of the Internal Auditor are addressed specifically for the prevention of Money Laundering, Terrorist Financing and Proliferation Financing:
5.1.1. the Internal Auditor shall review and evaluate, at least on an annual basis, the appropriateness, effectiveness and adequacy of the policy, practices, measures, procedures and controls applied by the Company for the prevention of Money Laundering, Terrorist Financing and Proliferation Financing;
5.1.2. the findings and observations of the Internal Auditor, in relation to point (a) above, shall be submitted, in a written report form, to the Board.
6. COMPLIANCE OFFICER
General
6.1. The CO shall belong hierarchically to the higher ranks of the Company's organisational structure so as to command the necessary authority. Furthermore, the CO shall lead the Company's Money Laundering Compliance procedures and processes and report to the Board.
6.2. The level of remuneration of the CO shall not compromise their objectivity.
6.3. In performing their role, the Compliance Officer takes into account the nature, scale and complexity of its business, and the nature and range of investment services provided.
Duties of the CO
6.4. During the execution of their duties and the control of the compliance of the Company with the Law and the Regulations, the CO shall obtain and utilise data, information and reports from all relevant sources. The duties of the CO shall include, inter alia, the following:
6.4.1. to design, based on the general policy principles of the Company mentioned in point 4.1. of Section 4 of the Manual, the internal practice, measures, procedures and controls relevant to the prevention of Money Laundering, Terrorist Financing and Proliferation Financing. It is provided that the above include measures and procedures for the prevention of the abuse of new technologies and systems providing financial services, for the purposes of Money Laundering and Terrorist Financing;6.4.2. to act as the primary point of contact between the Company, the FSA, and the FIU on all matters relating to Money Laundering, Terrorist Financing, and Proliferation Financing, and to ensure that all correspondence, requests for information, directives, and supervisory notifications from the FSA and the FIU are received, recorded, assessed, and actioned within the timeframes prescribed by the FSA, the FIU, or applicable law;
6.4.3. to review and update the Manual as may be required from time to time, and for such updates to be communicated to the Board for their approval;
6.4.4. to monitor and assess the correct and effective implementation of the policy mentioned in point 4.1. of Section 4 of the Manual, the practices, measures, procedures and controls mentioned in point 6.4.1. above;
6.4.5. to receive information from the Company's employees which is considered to be knowledge or suspicion of Money Laundering or Terrorist Financing activities or might constitute a relevant indication (hereinafter the 'Internal Suspicion Report'), a specimen of such report is attached in Appendix 1 of the Manual;
6.4.6. to evaluate and examine the information received as per point 6.4.5. above, by reference to other relevant information and discuss the circumstances of the case with the relevant persons and prepare a written evaluation (hereinafter the 'Internal Evaluation Report'), a specimen of such report is attached in Appendix 2 of the Manual;
6.4.7. if following the evaluation described in point 6.4.6. above, the CO decides to notify the FIU, then they should complete a report (Suspicious Transactions Reports/Suspicious Activities Reports ('STR')) and submit it to the FIU as soon as practicable after suspicion is formed, in accordance with section 48 of the AML/CFT Act 2020;
6.4.8. if following the evaluation described in point 6.4.6. above, the CO decides not to notify the FIU, then they should fully explain the reasons for such a decision on the CO's Internal Evaluation Report;
6.4.9. to act as a first point of contact with the FIU, upon commencement of and during an investigation as a result of filing a report to the FIU according to point 6.4.7. above;
6.4.10. to ensure the preparation and maintenance of the lists of Clients categorised following a risk-based approach, which contains, among others, the names of Clients and their respective risk categorisation. Moreover, the CO ensures the updating of the said list with all new or existing Clients, in light of any additional information obtained;
6.4.11. to detect, record, and evaluate, at least on an annual basis, all risks arising from existing and new Clients, new financial instruments and services and update and improve the relevant measures and procedures accordingly;
6.4.12. to evaluate the systems and procedures applied by a third person on whom the Company relies for Client identification and due diligence purposes;
6.4.13. to provide advice and guidance to the employees of the Company on subjects related to Money Laundering and Terrorist Financing;
6.4.14. to acquire the knowledge and skills required for the improvement of the appropriate procedures for recognising, preventing and obstructing any transactions and activities related to Money Laundering and Terrorist Financing;
6.4.15. to determine whether the Company's departments and employees need further training and education for the purpose of preventing Money Laundering, Terrorist Financing and Proliferation Financing and to organise appropriate training sessions or seminars. In this respect, the CO prepares and applies an annual staff training program. Also, the CO assesses the adequacy of the education and training provided;
6.4.16. to prepare correctly and submit timely to FSA the compliance reports required under Section 8 (Compliance Reporting Obligations of the Manual and provide the necessary explanation to the appropriate employees of the Company for its completion;
6.4.17. to prepare the Annual Report, according to Section 7 of the Manual;
6.4.18. to respond to all requests and queries from the FIU and FSA, provide all requested information and fully cooperate with the FIU and FSA;
6.4.19. to maintain a registry which includes the reports of points 6.4.5., 6.4.6., and 6.4.7., and relevant statistical information (e.g. the department that submitted the internal report, date of submission, etc.);
6.4.20. to ensure the preparation and maintenance of the records of Clients identified through adverse media screening or data leak databases (including but not limited to the Panama Papers, Pandora Papers, FinCEN Files, and similar disclosures), as set out in Appendix 5 of the Manual.
7. ANNUAL REPORT OF THE CO
7.1. The Annual Report of the CO is a significant tool for assessing the Company's level of compliance with its obligation laid down in the Law and the Guidelines.
7.2. The CO's Annual Report shall be prepared and submitted to the Board for approval within 90 days from the end of each calendar year (i.e. by 31 March each year), in accordance with Regulation 13(h) of the AML/CFT Regulations, 2020.
7.3. Following the Board's approval of the Annual Report, a copy of the Annual Report should be submitted to FSA together with the Board's meeting minutes.
7.4. It is provided that the said minutes should include the measures decided for the correction of any weaknesses and/or deficiencies identified in the Annual Report.
7.5. The Annual Report deals with issues relating to Money Laundering and Terrorist Financing during the year under review and includes, inter alia, the following:
7.5.1. information for measures taken and/or procedures introduced for compliance with any amendments and/or new provisions of the Law and the Regulations which took place during the year under review;
7.5.2. information on the inspections and reviews performed by the CO, reporting the material deficiencies and weaknesses identified in the policy, practices, measures, procedures and controls applied by the Company for the prevention of Money Laundering, Terrorist Financing and Proliferation Financing. In this respect, the report outlines the seriousness of the deficiencies and weaknesses, the risk implications and the actions taken and/or planned to be taken in order to remedy the situation;
7.5.3. the number of Internal Suspicion Reports submitted by Company personnel to the CO;
7.5.4. the number of reports submitted by the CO to the FIU, with information or details on the relevant cases;
7.5.5. information on any notifications or instructions received from the FIU or FSA during the year under review, including requests for information, directions regarding specific accounts or transactions, and any matters arising from prior Annual Reports that remained outstanding;
7.5.6. summary figures, on an annualised basis, of Clients' total cash deposits in excess of the applicable reporting threshold as set out in the Company's AML/CFT policies (together with comparative figures for the previous year), as reported in the Compliance Reporting Obligations of Section 8 of the Manual. Any comments on material changes observed compared with the previous year are also reported;
7.5.7. information on the policy, measures, practices, procedures and controls applied by the Company in relation to high risk Clients as well as the number and country of origin of high risk Clients with whom a Business Relationship is established or an Occasional Transaction executed;
7.5.8. information on the systems and procedures applied by the Company for the ongoing monitoring of Client accounts and transactions;
7.5.9. information on the training courses or seminars attended by the CO and any other educational material received;
7.5.10. information on training or education and any educational material provided to staff during the year, reporting the number of courses or seminars organised, their duration, their content and the number of employees that attended;
7.5.11. results of the assessment of the adequacy and effectiveness of staff training;
7.5.12. information on the recommended next year's training program;
7.5.13. information on the structure and staffing of the department of the CO as well as recommendations and timeframe for their implementation, for any additional staff and resources needed.
8. COMPLIANCE REPORTING OBLIGATIONS
8.1. The CO shall prepare a quarterly internal compliance report for the Board regarding the prevention of Money Laundering, Terrorist Financing and Proliferation Financing, and submit an annual compliance report to the FSA in accordance with FSA Circular No. 10/2024.
8.2. The completion of the aforementioned Form provides the opportunity to the Company initially to evaluate and, subsequently, to reinforce its systems of control and monitoring of Money Laundering, Terrorist Financing and Proliferation Financing operations.
8.3. The Internal Auditor shall be responsible to review, at least annually, the submission to the FSA of the annual compliance report and the adequacy of the quarterly internal compliance reports.
9. RISK-BASED APPROACH
General Policy
9.1. The Company shall apply appropriate measures and procedures, by adopting a risk-based approach, so as to focus its effort in those areas where the risk of Money Laundering, Terrorist Financing and Proliferation Financing appears to be comparatively higher.
9.2. Further, the CO shall monitor and evaluate, on an ongoing basis, the effectiveness of the measures and procedures of this Section of the Manual.
9.3. The adopted risk-based approach that is followed by the Company, and described in the Manual, has the following general characteristics:
9.3.1. recognises that the Money Laundering or Terrorist Financing threat varies across Clients, countries, services, and financial instruments.
9.4. Such measures include:
9.4.1. identifying and assessing the Money Laundering, Terrorist Financing and Proliferation Financing risks emanating from particular Clients or types of Clients, financial instruments, services, and geographic areas;
9.4.2. managing and mitigating the assessed risks by the application of appropriate and effective measures, procedures and controls.
9.5. The application of appropriate measures and the nature and extent of the procedures on a risk-based approach depends on different indicators.
9.6. Such indicators include the following:
9.6.1. the scale and complexity of the services offered;
9.6.2. geographical spread of the services and Clients.
9.7. The CO shall be responsible for the development of the policies, procedures and controls on a risk-based approach. Further, the CO shall also be responsible for the ongoing monitoring of their effectiveness.
9.8. The Internal Auditor shall be responsible for reviewing the adequate implementation of a risk-based approach by the CO, as part of the annual comprehensive AML/CFT audit or as triggered by a material risk event.
Identification of Risks
General/Principles
9.9. The risk-based approach adopted by the Company involves the identification, recording and evaluation of the risks that have to be managed.
9.10. The Company shall assess and evaluate the risks it faces, for the use of the Investment and Ancillary Services for the purpose of Money Laundering or Terrorist Financing.
9.11. In the cases where the services and the financial instruments that the Company provides are relatively simple, involving relatively few Clients or Clients with similar characteristics, the implementation of the risk-based approach will also be less complex.
9.12. The Company shall be, at all times, in a position to demonstrate to FSA that the extent of measures and control procedures it applies are proportionate to the risk it faces for the use of its services for the purposes of Money Laundering or Terrorist Financing.
Company Risks
9.13. The following, inter alia, are sources of risks which the Company faces with respect to Money Laundering, Terrorist Financing and Proliferation Financing:
9.13.1. Risks based on the Client's nature:
9.13.1.1. complexity of ownership structure of legal persons;
9.13.1.2. companies with bearer shares;
9.13.1.3. PEPs;
9.13.1.4. the Clients engaged in transactions which involves significant amounts of cash;
9.13.1.5. the Clients from high risk countries or countries known for high level of corruption, organised crime, or drug trafficking;
9.13.1.6. the Clients convicted for a Prescribed Offence (and already served their sentence) subject to enhanced due diligence including source of wealth verification and senior management approval;
9.13.1.7. unwillingness of Client to provide information on the Beneficial Owners of a legal person.
9.13.2. Risks based on the Client's behaviour:
9.13.2.1. the Client's transactions where there is no apparent legal financial or commercial rationale;
9.13.2.2. situations where the origin of wealth and/or source of funds cannot be easily verified.
9.13.3. Risks based on the Client's initial communication with the Company:
9.13.3.1. non-face-to-face Client;
9.13.3.2. Clients introduced by a third person.
9.13.4. Risks based on the Company's services and financial instruments:
9.13.4.1. services that allow payments to third persons or parties;
9.13.4.2. large cash deposits or withdrawals.
Design and Implementation of Measures and Procedures to Manage and Mitigate the Risks
9.14. Taking into consideration the assessed risks, the Company shall determine the type and extent of measures it will adopt in order to manage and mitigate the identified risks in a proportionate manner. Such measures include:
9.14.1. adaptation of the Client Due Diligence Procedures in respect of Clients in line with their assessed Money Laundering, Terrorist Financing and Proliferation Financing risk through independent checks;
9.14.2. requiring the quality and extent of required identification data for each type of Client to be of a certain standard (e.g. documents from independent and reliable sources).
9.15. In this respect, it is the duty of the CO to develop and constantly monitor and adjust the Company's policies and procedures with respect to the Client Acceptance Policy and Client Due Diligence procedures.
Dynamic Risk Management
9.16. Risk management is a continuous process, carried out on a dynamic basis. Risk assessment is not an isolated event of a limited duration. Clients' activities change as well as the methods and typologies of Money Laundering and Terrorist Financing.
9.17. In this respect, it is the duty of the CO to undertake regular reviews of the characteristics of existing Clients, new Clients, services and financial instruments and the measures, procedures and controls applicable to each.
Relevant International Organisations
9.18. For the development and implementation of appropriate measures and procedures on a risk-based approach, and for the implementation of Client Identification and Due Diligence Procedures, the CO and the Administration or theBack-Office Department shall consult data, information and reports from the following organisations (e.g. Clients from countries which inadequately apply FATF recommendations):
9.18.1. FATF—www.fatf-gafi.org
9.18.2 The Eastern and Southern Africa Anti-Money Laundering Group (hereinafter 'ESAAMLG')—www.esaamlg.org—www.coe.int/moneyval
9.18.3. The UN Security Council Sanctions Committees—www.un.org/sc/committees
9.18.4. The International Money Laundering Information Network (IMOLIN)—www.imolin.org
9.18.5. The International Monetary Fund (IMF)—www.imf.org
10. CLIENT ACCEPTANCE POLICY
10.1. The Client Acceptance Policy (hereinafter the 'CAP'), following the principles and guidelines described in this Manual, defines the criteria for accepting new Clients.
10.2. The CO shall be responsible for applying all the provisions of the CAP. In this respect, the Head of the Administration or the Back Office Department shall also be assisting the CO in this regard.
10.3. The Internal Auditor shall review and evaluate the adequate implementation of the CAP and its relevant provisions as part of the annual comprehensive AML or CFT audit, as per Section 5 of the Manual.
General Principles of the CAP
10.4. The General Principles of the CAP are the following:
10.4.1. the Company shall classify Clients into various risk categories and based on the risk perception decide on the acceptance criteria for each category of Client;
10.4.2. where the Client is a prospective Client, an account must be opened only after the relevant pre-account opening due diligence and identification measures and procedures have been completed, as per Section 11 of the Manual;
10.4.3. all documents and data must be collected before the establishment of a business relationship with a new Client;
10.4.4. by way of derogation of point 10.4.3. above, the verification of the identity of a new Client may be completed during the establishment of the business relationship;
10.4.5. no account shall be opened in anonymous or fictitious name(s);
10.4.6. no account shall be opened unless the prospective Client is approved by the Head of the Administration or the Back Office Department.
Criteria for Accepting New Clients (based on their respective risk)
10.5. This Section describes the criteria for accepting new Clients based on their risk categorisation.
Low Risk Clients
10.6. The Company shall accept Clients who are categorised as low risk Clients as long as the general principles under Section 10 (General Principles of the CAP) are followed.
10.7. Moreover, the Company shall follow the Simplified Client Identification and Due Diligence Procedures for low risk Clients.
Normal Risk Clients
10.8. The Company shall accept Clients who are categorised as normal risk Clients as long as the general principles are followed.
High Risk Clients
10.9. The Company shall accept Clients who are categorised as high risk Clients as long as the general principles are followed.
10.10. Moreover, the Company shall apply the Enhanced Client Identification and Due Diligence measures for high risk Clients, and the due diligence and identification procedures for the specific types of high risk Clients as applicable.
Not Acceptable Clients
10.11. The following list predetermines the type of Clients who are not acceptable for establishing a Business Relationship or an execution of an Occasional Transaction with:
10.11.1. Clients who fail or refuse to submit the requisite data and information for the verification of their identity and the creation of their economic profile, without adequate verification of their identity and the creation of their economic profile;
10.11.2. Companies with bearer shares—only acceptable where all bearer shares have been verifiably immobilized with an approved custodian in accordance with the Beneficial Ownership Act 2020 before the Business Relationship is established; otherwise Not Acceptable;
10.11.3. Shell Banks;
10.11.4. Clients included in Sanctions Lists;
10.11.5. Clients convicted for a Prescribed Offence (and not served their sentence).
Client Categorisation Criteria
10.12. This Section defines the criteria for the categorisation of Clients based on their risk. The CO shall be responsible for categorising Clients in one of the following three (3) categories based on the criteria of each category set below:
Low Risk Clients
10.13. The Company may apply simplified due diligence to the following types of Clients, provided that this represents a low risk or no suspicion for Money Laundering and Terrorist Financing:
10.13.1. credit or financial institution;
10.13.2. credit or financial institution carrying out one or more of the financial business activities;
10.13.3. listed companies whose securities are admitted to trading on a Regulated Market in an equivalent jurisdiction;
10.13.4. individual (natural person) Clients where the overall assessment indicates a low degree of ML/TF risk, taking into account all of the following factors:
10.13.4.1. the Client is resident in a jurisdiction that is not identified as high-risk or subject to enhanced monitoring by the FATF or the FSA;
10.13.4.2. the product or service involves an online trading account funded exclusively by bank transfer or equivalent electronic payment (no cash or anonymous payment methods);
10.13.4.3. the Client is not a PEP, is not subject to any Sanctions, and presents no adverse media;
10.13.4.4. and the purpose of the business relationship and source of funds are clear and consistent with the Client's known economic profile.
10.14. It is provided that, further to the cases mentioned above, the Company has to gather sufficient information to establish if the Client qualifies as a low-risk Client.
Normal Risk Clients
10.15. The following types of Clients can be classified as normal risk Clients with respect to the Money Laundering, Terrorist Financing and Proliferation Financing risk which the Company faces:
10.15.1. any Client who does not fall under the 'low risk Clients' or 'high risk Clients' categories, respectively.
High Risk Clients
10.16. The following types of Clients can be classified as high risk Clients with respect to the Money Laundering, Terrorist Financing and Proliferation Financing risk which the Company faces:
10.16.1. the Clients who are not physically present for identification purposes (non-face-to-face Clients) where, in addition to the delivery channel, other risk factors are also present (such as the customer being resident in a high-risk jurisdiction, the transaction being of unusual size or complexity, or the source of funds being unclear);
10.16.2. the Clients whose own shares or those of their parent companies (if any) have been issued in bearer form;
10.16.3. trust accounts;
10.16.4. the Clients convicted for a Prescribed Offence (and already served their sentence);
10.16.5. cross-frontier correspondent banking relationships with credit institutions—Clients from third countries;
10.16.6. any other Clients whose nature entails a higher risk of Money Laundering or Terrorist Financing.
11. CLIENT DUE DILIGENCE AND IDENTIFICATION PROCEDURES
Cases for the application of Client Identification and Due Diligence Procedures
11.1. The Company shall duly apply Client identification procedures and Client due diligence measures in the following cases:
11.1.1. when establishing a Business Relationship;
11.1.2. at the time of account opening, upon submission of the Client's Account Opening Application ('AOA'), and in all cases before the Company activates the Client's account or permits any transaction to occur;
11.1.3. when there are doubts about the veracity or adequacy of previously obtained Client identification data;
11.1.4. when the Company knows or suspects, or has reasonable grounds to suspect, that a Client or transaction is related to Money Laundering, Terrorist Financing, or any other prescribed offence under the Law, regardless of any threshold or exemption that might otherwise apply;
11.1.5. in this respect, it is the duty of the CO to apply all the relevant Client Due Diligence Identification Procedures for each of the cases mentioned above. Furthermore, the Administration or the Back-Office Department shall also be responsible to collect and file the relevant Client identification documents, according to the record-keeping procedures of Section 14 of the Manual.
Ways of application of Client Identification and Due Diligence Procedures
11.2. Client identification procedures and Client due diligence measures shall comprise:
11.2.1. identifying the Client and verifying the Client's identity on the basis of documents, data or information obtained from a reliable and independent source.
11.3. It is noted that the identification procedure includes the following:
11.3.1.reation of an economic profile for the Customer or the Beneficial Owner;
11.3.2.arrying out an appropriateness test in accordance with applicable requirements.
11.3.3. passport or identity card and proof of address as a reliable option to ascertain the identity of the Client;
11.3.4. resume, proof of source of funds for Clients investing an amount which is material in the business;
11.3.5. obtaining information on the purpose and intended nature of the business relationship;
11.3.6. conducting ongoing monitoring of the business relationship including scrutiny of transactions undertaken throughout the course of that relationship to ensure that they are consistent with the Company's knowledge of the Client, their business, and risk profile;
11.3.7. screening Clients against databases or third party checks for adverse tax-related news.
11.4. The Company applies each of the customer due diligence measures and identification procedures set out above, but may determine the extent of such measures on a risk-sensitive basis.
Transactions that Favour Anonymity
11.5. In the case of Clients' transactions via internet, phone, fax or other electronic means where the Client is not present, the Company shall apply enhanced due diligence measures in order to verify the identity of the Client. In such cases, the Company shall take additional measures to compensate for the higher risk, such as requiring submission of certified copies of identification documents and proof of address, conducting video verification, or applying other measures approved by the CO.
Failure or Refusal to Submit Information for the Verification of Clients' Identity
11.6. Failure or refusal by a Client to submit, before the establishment of a Business Relationship or the activation of a trading account, the requisite data and information for the verification of their identity and the creation of their economic profile constitutes grounds for refusal to establish the Business Relationship and activate the trading account.
11.7. If, during the Business Relationship, a Client fails or refuses to submit, within a reasonable timeframe, the required verification data and information according to Section 11 of the Manual, the Company and the CO shall consider terminating the Business Relationship.
Time of Application of the Client Identification and Due Diligence Procedures
11.8. With respect to the timing of the application of the Client Identification and Due Diligence Procedures, the CO shall be responsible for the application of the following provisions, in accordance with section 39 of the AML/CFT Act 2020 and FATF Recommendation 10:
11.8.1. General Rule (s.39(1)): The verification of the identity of the Client and the Beneficial Owner shall be performed before the establishment of a Business Relationship or the carrying out of a transaction. This is the default requirement and applies to all Client categories unless the conditions for post-establishment verification below are met.
11.8.2. Post-Establishment Verification (s.39(2)): By way of derogation from the General Rule above, the verification of the identity of the customer and the Beneficial Owner may be completed during or shortly after the establishment of a Business Relationship, where: (a) it is necessary so as not to interrupt the normal conduct of business (including non-face-to-face onboarding and securities or FX transactions); (b) there is no reasonable suspicion of Money Laundering or Terrorist Financing; and (c) CDD is completed as soon as practicable. Where post-establishment verification is applied, the Company shall operate a phased onboarding process as follows:
11.8.2.1. Phase 1—Provisional Access (Day 0): The Client is onboarded upon collection of basic identification data (full name, date of birth, nationality, email, and a copy or photograph of a government-issued identity document). The Company accepts deposits only from a bank account or payment method that is in the name of the customer or Beneficial Owner. A deposit cap of USD 5,000 (or equivalent) shall apply until Phase 2 is completed. No withdrawals shall be permitted until full CDD has been completed.
11.8.2.2. Phase 2—Full CDD (within 15 business days of initial contact): All remaining CDD documentation (proof of address, source of funds declaration, Beneficial Ownership information, and completed economic profile) must be obtained and verified. If verification is not completed within 15 business days, the account shall be suspended and no further transactions permitted until compliance is achieved. The CO shall issue reminders to the Client at Day 5 and Day 10.
11.8.2.3. Phase 3—Enhanced CDD (where applicable): For Clients who, upon or after completion of Phase 2, are identified as high-risk, PEP, or from a high-risk jurisdiction, the Enhanced CDD procedures under Section 11 of this Manual shall be applied before any further account activity is permitted. Initial contact takes place the moment that the Client either accepts the terms and conditions or makes their first deposit, whichever comes first.
11.8.3. Exclusions from Post-Establishment Verification: The following Client categories are excluded from post-establishment verification and must complete full CDD (and Enhanced CDD where applicable) before the establishment of any Business Relationship: (a) Politically Exposed Persons (PEPs), their family members and known close associates; (b) Clients from FATF-identified high-risk or non-cooperative jurisdictions; (c) legal persons or arrangements with complex or opaque ownership structures; (d) any Client where there is a suspicion of ML/TF, regardless of risk classification (e.g. the Company issues requests or reminders to the Customer or the Beneficial Owner informing them of their obligation to submit the requested documents for the completion of the verification procedure);
11.8.4. The Company's post-establishment verification policy shall be formally documented, approved by the Board of Directors, and made available to the FSA upon request. Any material changes to this policy shall be notified to the FSA. No funds are withheld and no accounts are frozen during the post-establishment verification period, save for those cases of suspicion of Money Laundering, where the Company is under obligation to report the suspicious transaction to the FIU (please refer to Section 13 of this Manual), where the regulated entity is under obligation to report (in accordance with the Compliance Reporting Obligations) of the suspicious transaction incident in the designated procedure (please refer to Section 8 of this Manual).
11.9. It is noted that the Company shall complete the prescribed procedures for the verification of customers' identity before the establishment of a business relationship.
11.10. In those extraordinary cases where the verification of a customer or Beneficial Owner's identity takes place during the establishment of a business relationship (after the initial contact), the Company shall subject the account to enhanced transaction monitoring until full CDD is completed, including:
11.10.1. automated alerts for any transaction exceeding 50% of the deposit cap;
11.10.2. daily review of account activity by the CO or designated staff;
11.10.3. immediate escalation to the CO of any unusual or suspicious activity.
11.11. In cases where the Company is unable to complete the required CDD, the Company shall not establish the Business Relationship, shall not activate the Client's account, and shall not permit any transaction to proceed.
11.12. Identification procedures and Client due diligence requirements shall be applied not only to all new Clients but also to existing Clients at appropriate times, depending on the assessed risk level.
Construction of an Economic Profile and General Client Identification and Due Diligence Principles
11.13. The construction of the Client's economic profile needs to include or follow the principles below:
11.13.1. the Company shall be satisfied that it is dealing with a real person and, for this reason, the Company shall obtain sufficient evidence of identity to verify the natural or legal person, sole trader, or partnership, and the Company shall request and obtain sufficient data and information regarding the Client business activities and profile;
11.13.2. the verification of the Clients' identification shall be based on reliable data and information issued or obtained from independent and reliable sources;
11.13.3. a person's residential and business address will be an essential part of their identity;
11.13.4. the Company will never use the same verification data or information for verifying the Client's identity and verifying its home address;
11.13.5. the data and information that are collected before the establishment of the Business Relationship, with the aim of constructing the Client's economic profile, shall, as a minimum, include the following:
11.13.5.1. the purpose and the reason for requesting the establishment of a Business Relationship;
11.13.5.2. the anticipated account turnover, the nature of the transactions, the expected origin of incoming funds to be credited in the account and the expected outgoing payments;
11.13.5.3. the Client's size of wealth and annual income and the clear description of the main business, professional activities, or operations;
11.13.5.4.the Client's investment objectives and risk tolerance in relation to the Licensed Services;
11.13.5.5. the Client's prior experience and knowledge of trading in securities and/or Contracts for Difference (CFDs) and other derivatives;
11.13.5.6. the source of funds to be deposited and the source of wealth underpinning those funds;
11.13.5.7. the expected frequency and approximate size of individual transactions.
11.13.6. the data and information that are used for the construction of the Client-legal person's economic profile shall include, inter alia, the following:
11.13.6.1. the name of the Company;
11.13.6.2. the country of its incorporation;
11.13.6.3. financial information;
11.13.6.4.the ownership structure of the group that the Client-legal person may be a part of (country of incorporation of the parent company, subsidiary companies, and the Beneficial Owners).
11.13.7. The said data and information are recorded in a separate form designed for this purpose which is retained in the Client's file along with all other documents. Identical data and information with the abovementioned shall be obtained in the case of a Client-natural person, and in general, the same procedures with the abovementioned shall be followed.
11.14. For the purposes of the provisions relating to identification procedures and Client due diligence requirements, proof of identity is satisfactory if:
11.14.1. it is reasonably possible to establish that the Client is the person they claim to be; and,
11.14.2. the person who examines the evidence is satisfied, in accordance with the procedures followed under the Law, that the Client is actually the person they claim to be.
11.15. The construction of the Client's economic profile according to the provisions above shall be undertaken by the CO. In this respect, the data and information collected for the construction of the economic profile shall be kept in the Client's file.
Further Obligations for Client Identification and Due Diligence Procedures
11.16. In addition to the principles described, the Company, and specifically the CO shall:
11.16.1. ensure that the Client identification records remain completely updated with all relevant identification data and information throughout the Business Relationship;
11.16.2. The procedures and controls also determine implicitly the timeframe during which the regular review, examination and update of the Client identification is conducted.
11.17. Despite the obligation described in point 11.13. above and while taking into consideration the level of risk, if at any time during the Business Relationship, the Company identifies unusual activity, the Company shall update the Client identification records accordingly.
11.18. In addition to the obligation of points 11.13. and 11.14. above, the Company shall check the adequacy of the data and information of the Client's identity and economic profile, whenever any of the following circumstances arise:
11.18.1. an important transaction takes place which appears to be unusual and/or significant compared to the normal pattern of transactions and the economic profile of the Client;
11.18.2. a material change in the Client's legal status and situation, such as:
11.18.2.1. change of directors or secretary;
11.18.2.2. change of registered shareholders and/or Beneficial Owners.
11.18.3. a material change in the way and the rules the Client's account operates, such as:
11.18.3.1. change in the persons that are authorised to operate the account;
11.18.3.2. application for the opening of a new account for the provision of new services.
11.19. In addition to the above, the Company, when making transfers of money between Clients' accounts, shall apply the following procedures:
11.19.1. Ask, from both Clients directly involved (originator of the transfer and recipient of the transfer), to complete a form of order and acceptance of the money transfer respectively;
11.19.2. Before performing the money transfer, the responsible person (e.g. Head of the Accounting Department) shall confirm the order and acceptance of the money transfer by telephone or by other equivalent method. If the confirmation cannot be obtained, the transaction shall not proceed;
11.19.3. The CO shall:
11.19.3.1. verify the authenticity of the signatures on the aforementioned form;
11.19.3.2. record (e.g. on the form) the reasons and confirm the legality of the purpose of the transfer. A copy shall be kept in the respective Clients' files.
Simplified Client Identification and Due Diligence Procedures
11.20. With respect to the provisions of the Law and the Regulations for simplified Client Identification and Due Diligence Procedures, the following shall apply:
11.20.1. In the cases of points 11.1.1., 11.1.2., and 11.1.3. of the Cases for the Application of Client Identification and Due Diligence Procedures subsection of Section 11, the Company may not apply the measures described in the Ways of Application subsection of Section 11, point 11.8.1. of the Time of Application subsection of Section 11, or the Construction of an Economic Profile and Further Obligations subsections of Section 11 of the Manual for a Client who may be categorised as a low risk Client according to the criteria set in the Client Categorisation Criteria subsection of Section 10 of the Manual.
11.21. For simplified Client Identification and Due Diligence Procedures, the Company may not verify the identification of the client or the Beneficial Owner, or collect information on the intended purpose and nature of the Business Relationship.
11.22. The Company shall, when applying simplified Client identification and due diligence procedures, obtain at minimum the following information:
11.22.1. the Client's full name and, for legal persons, the registered name and country of incorporation;
11.22.2. and sufficient information to understand the nature and purpose of the business relationship. Even where simplified procedures apply, the Company must be capable of demonstrating to the FSA that the simplified approach was justified by the Client's risk categorisation and that no information available to the Company at the time suggested a higher level of risk.11.23. In addition to the above, the Company must exercise continuous monitoring of the business relationships mentioned in the Client Categorisation Criteria subsection of Section 10. According to the provisions of the Law and the Regulations, the simplified procedures do not apply if the Company has any reason to suspect Money Laundering or Terrorist Financing.
11.24. Further to the above, FSA may permit simplified KYC for low risk products and transactions, subject to specific criteria as defined in the AML Law as amended.
11.25. It is provided that the Company shall collect sufficient information, so as to decide whether the Client can be exempted according to the provisions of point 11.24. already described above.
11.26. The Company shall not consider that Clients or transactions referred to in point 11.24. above represent a low risk of Money Laundering or Terrorist Financing if there is information available to suggest that the risk of Money Laundering or Terrorist Financing is higher than expected.
Enhanced Client Identification and Due Diligence (High Risk Clients)
General Provisions
11.27. The CO shall apply enhanced due diligence measures with respect to the Clients categorised as high risk Clients.
11.28. These measures include the following:
11.28.1. where the Client has not been physically present for identification purposes, the Company shall apply one or more of the following measures:
11.28.1.1. take supplementary measures to verify or certify the documents supplied;
11.28.1.2. or requiring confirmatory certification by a credit or financial institution.
11.28.2. in respect of cross-frontier correspondent banking relationships with credit institutions—Clients from third countries, the Company shall:
11.28.2.1. gather sufficient information about the credit institution-Client to understand fully the nature of the business and the activities of the Client.
11.28.3. with respect to transactions or Business Relationships with PEPs, the Company shall:
11.28.3.1. have appropriate risk-based procedures to determine whether the Client (or the Beneficial Owner) is a PEP;
11.28.3.2. take adequate measures to establish the source of wealth and source of funds that are involved in the Business Relationship or transaction.
11.29. Below are described due diligence and identification procedures with respect to high risk Clients.
Non face-to-face Clients
11.30. The Company shall apply the following with respect to non-face-to-face Clients:
11.30.1. whenever a customer requests the establishment of a Business Relationship or an Occasional Transaction, a personal interview may be conducted where the risk assessment warrants it. Where conducted, the documentation retained by the Company in its records shall take the following form:
11.30.1.1. riginal;
11.30.1.2. or certified true copy of the original, where the certification is made by the Company, in cases where it establishes the customer's identity itself, once the original is presented thereto;
11.30.1.3. or copy of the original;
11.30.1.4. or identification information and documents collected via electronic means as described below.
11.31. Instead of the measure prescribed above, other practical procedures may be adopted for the implementation of the measure with regard to customers, including:
11.31.1. the Company ensures that the first payment of the operations is carried out through an account opened in the customer's name with a credit institution;
11.31.2. the Company obtains a direct confirmation of the establishment of a business relationship through direct personal contact, as well as the true copy of the customer's identification documents;
11.31.3. the Company arranges a telephone contact with the customer at their home or office, on a telephone number which has been verified from independent sources, in order to:
11.31.3.1. confirm and monitor both the amount of the customer's deposit and the risk for Money Laundering or Terrorist Financing and take appropriate action;
11.31.3.2. ensure the normal conduct of business is not interrupted where the amount of the deposit exceeds the amount of USD 10,000 (or equivalent) per annum, or such other threshold as determined by the Company's risk assessment;
11.31.3.4. warn the customer appropriately and in due time for the above procedure in order to obtain the customer's express consent prior to proceeding.
11.32. The Company arranges a communication with the customer at an address that the Company has previously verified from independent and reliable sources.
11.33. The Company performs an electronic verification:
11.33.1. electronic identity verification is carried out either directly by the Company or through a third party. Both the Company and the said third parties cumulatively satisfy the following conditions:
11.33.2. the electronic databases kept by the third party or to which the third person or the Company has access are registered to and/or approved, and include measures for the prevention of the committing of offences such as identity theft, inclusion in deceased persons records, inclusion in sanctions and restrictive measures lists (e.g. UN Security Council, FATF High-Risk Jurisdictions, OFAC);
11.33.3. electronic databases include a wide range of sources with information from different time periods with real-time update capabilities;
11.33.4. transparent procedures have been established allowing the Company to know which information was searched, the result of such search and its significance in relation to the level of assurance provided;
11.33.5. procedures have been established allowing the Company to record and save the information used and the result in relation to identity verification.
11.34. The information must come from two or more sources. The electronic verification procedure shall at least satisfy the following correlation requirements:
11.34.1. identification of the customer's full name and current address from one source;
11.34.2. and additional verification from a second independent source.
11.35. For purposes of carrying out the electronic verification, the Company shall establish procedures in order to satisfy the completeness, validity and accuracy requirements of the verification.
11.36. It is understood that the Company evaluates the results of the verification of the identity in order for the conditions to be satisfied. The Company establishes mechanisms for the carrying out of quality controls in order to assess the quality of the information on which it intends to rely.
Account in names of companies whose shares are in bearer form
11.37. The CO shall apply enhanced due diligence before on-boarding accounts in names of companies whose shares are or were in bearer form. The CO shall verify that all bearer shares have been immobilized with an approved custodian in accordance with applicable law, and obtain documentary evidence of the custodial arrangements, before proceeding with the business relationship.
Trust accounts
11.38. The CO shall apply the following with respect to trust accounts:
11.38.1. When the Company establishes a Business Relationship or carries out an Occasional Transaction with trusts, it shall ascertain the legal substance, the name and the date of establishment of the trust and verify the identity of the trust, trustee and Beneficial Owners.
11.38.2. Furthermore, the Company shall ascertain the nature of activities and the purpose of establishment of the trust as well as the source and origin of funds.
'Client accounts' in the name of a third person
11.39. The CO shall apply the following with respect to 'Client accounts' in the name of a third person:
11.39.1. The Company may open 'Client accounts' (e.g. omnibus accounts) in the name of financial institutions, in accordance with a relevant decision of the FIU.
11.39.2. Client identification procedures prescribed throughout Section 11 of the Manual shall be followed.
11.40. In the case that the opening of a 'Client account' is requested by a third person acting as an auditor, an accountant, an independent legal professional, or a trust and company service provider, the CO must be satisfied that:
11.40.1. the third person is subject to mandatory professional registration in accordance with the relevant laws of the country of operation;
11.40.2. the third person is subject to regulation and supervision by an appropriate competent authority in the country of operation for Anti-Money Laundering, Terrorist Financing and Proliferation Financing purposes;
11.40.3. the CO has assessed the Client identification and due diligence procedures implemented by the third person and has found them to be in line with the Law;
11.40.4. the third person makes available to the Company all the data and documents prescribed.
'Politically Exposed Persons' accounts
11.41. The Company shall apply the following with respect to the accounts of 'Politically Exposed Persons'.
11.42. The establishment of a Business Relationship or the execution of an Occasional Transaction with Politically Exposed Persons may expose the Company to enhanced risks, especially if the potential Client seeking to establish a Business Relationship or execute an Occasional Transaction holds public responsibilities in areas with high levels of corruption.
11.43. The Company shall pay more attention when the said persons originate from a country which is widely known to face problems of bribery, corruption and financial crime.
11.44. In order to effectively manage such risks, the Company shall assess the countries of origin of its Clients in order to identify the ones that are more vulnerable to corruption.
11.45. With regard to the issue of corruption, one useful source of information is the Transparency International Corruption Perceptions Index which can be found on the website of Transparency International at www.transparency.org.
11.46. With regard to the issue of adequacy of application of the 40 Recommendations of the FATF (as revised in 2012 and updated periodically), the Company shall retrieve information from the country assessment bodies applying FATF's principles (e.g. ESAAMLG, the FATF-Style Regional Body for Eastern and Southern Africa) or the International Monetary Fund.
11.47. The meaning of 'Politically Exposed Persons' includes the following natural persons who are or have been entrusted with prominent public functions in Seychelles or abroad:
11.47.1. heads of State, heads of government, ministers and deputy or assistant ministers;
11.47.2. members of parliaments;
11.47.3. members of supreme courts, of constitutional courts or of other high-level judicial bodies whose decisions are not subject to further appeal;
11.47.4. members of courts of auditors or of the boards of central banks;
11.47.5. ambassadors, chargés d'affaires and high-ranking officers in the armed forces;
11.47.6. members of the administrative, management or supervisory bodies of State-owned enterprises.
11.48. Without prejudice to the application, on a risk-sensitive basis, of enhanced Client due diligence measures, where a person has ceased to be entrusted with a prominent public function, the Company shall continue to apply enhanced due diligence for a period of at least three (3) years and until the risk is assessed as no longer elevated, consistent with the definition of Politically Exposed Person under the AML/CFT Act, 2020, which encompasses any person who has been entrusted with a prominent public function during the preceding three years.
11.49. None of the categories set out in point 11.47 above shall be understood as covering middle ranking or more junior officials. 'Immediate family members' includes the following:
11.49.1. the spouse or the person with whom they cohabit for at least one year;
11.49.2. the children and their spouses or the persons with whom they cohabit for at least one year;
11.49.3. the parents.
11.50. 'Persons known to be close associates' includes the following:
11.50.1. any natural person who is known to have joint Beneficial Ownership of legal entities or legal arrangements, or any other close business relations, with a person referred to in point 11.47. above;
11.50.2. any natural person who has sole Beneficial Ownership of a legal entity or legal arrangement which is known to have been set up for the benefit de facto of the person referred to in point 11.47. above.
11.51. The Company adopts the following additional due diligence measures when it establishes a Business Relationship or carries out an Occasional Transaction with a PEP:
11.51.1. the Company puts in place appropriate risk management procedures to enable it to determine whether a prospective Client is a PEP. Such procedures may include screening of Clients, Beneficial Owners, authorised signatories, and persons authorised to act on behalf of the legal entities and arrangements, to determine whether they constitute PEPs. In case of identifying one such PEP, the procedures below shall apply;
11.51.2. the decision for establishing a Business Relationship or the execution of an Occasional Transaction with a PEP is taken by an Executive Director of the Company, which decision is then forwarded to the CO;
11.51.3. before establishing a Business Relationship or executing an Occasional Transaction with a PEP, the Company shall obtain adequate documentation to ascertain not only the identity of the said person but also to assess their business reputation;
11.51.4. the Company shall create the economic profile of the Client by obtaining the information specified in the Construction of an Economic Profile subsection of Section 11. The details of the expected business and nature of activities of the PEP shall be specifically documented;
11.51.5. PEP accounts shall be subject to an annual portfolio-level review, with individual account reviews triggered by risk events or at the CO's discretion, in order to determine whether to allow continuance of operation. A short report shall be prepared summarising the review findings.
11.52. The portfolio-level PEP review report shall be submitted to the Board for consideration. Individual account review reports, where prepared, shall be filed in the Client's personal file.
Electronic gambling or gaming through the internet
11.53. The Company shall apply the following with respect to accounts related to electronic gambling or gaming through the internet.
11.54. The Company may establish a Business Relationship or execute an Occasional Transaction in the names of persons who are involved in the abovementioned activities, provided that these persons are licensed by a competent authority of a recognised jurisdiction. The Company shall request and obtain, apart from the data and information required by the Manual, a copy of the licence that has been granted to the said persons by the competent authority.
11.55. Furthermore, the Company shall collect adequate information so as to understand the Clients' control structure and ensure that the said Clients apply adequate and appropriate systems and procedures for Client identification and due diligence for the prevention of Money Laundering and Terrorist Financing.
11.56. In the case that the Client is a person who offers services (e.g. payment providers, software houses, card acquirers) to the persons mentioned in point 11.54 above, then the Company shall request and obtain, apart from the data and information required by the Manual, adequate information so as to be satisfied that the services are offered only to licensed persons. The Company will also obtain information necessary to completely understand the ownership structure and the group in which the Client belongs, as well as any other information that is deemed necessary so as to establish the Client's economic profile. Additionally, the Company shall obtain the signed agreement between its Client and the Company that is duly licensed for electronic gambling or gaming activities through the internet, by a competent authority of a country mentioned in point 11.54. above.
11.57. For all the above cases, the decision for the establishment of a Business Relationship or the execution of an Occasional Transaction is taken by the CO, with a summary of all such decisions reported to the Board on a quarterly basis. The decision is documented and forwarded to the CO. Moreover, the account of the said Client is closely monitored and subject to regular review with a view to deciding whether to allow its continuance of operation. A short report shall be prepared and kept in the Client's personal file.
Clients from countries which inadequately apply FATF's recommendations
11.58. The FATF 40 Recommendations (as revised in 2012 and updated periodically) constitute the primary internationally recognised standards for the prevention and detection of Money Laundering and Terrorist Financing.
11.59. The Company shall apply the following with respect to Clients from countries which inadequately apply FATF's recommendations:
11.59.1. exercise additional monitoring procedures and pay special attention to Business Relationships and transactions with persons, including companies and financial institutions, from countries which do not apply or apply inadequately the aforesaid recommendations;
11.59.2. transactions with persons from the said countries, for which there is no apparent economic or visible lawful purpose, are further examined for the establishment of the background and purpose;
11.59.3. with the aim of implementing the above, the Head of the Administration or the Back-Office Department and the CO shall consult the country assessment reports prepared by the FATF (http://www.fatf-gafi.org), the other regional bodies that apply FATF principles [e.g. ESAAMLG, the FATF-Style Regional Body for Eastern and Southern Africa (www.coe.int/moneyval)] and the International Monetary Fund.
Adverse Media and Data Leak Screening (including historical Panama Papers)
11.60. Before the establishment of a business relationship or the carrying out of an Occasional Transaction, the Company shall screen potential Clients against adverse media sources, data leak databases (including but not limited to the historical Panama Papers / Mossack Fonseca leaks, Pandora Papers, and similar disclosures), and commercially available negative news databases. Where a match is identified, the CO shall:
11.60.1. apply enhanced due diligence measures as prescribed in this Manual;
11.60.2. obtain adequate documentation to assess the Client's business reputation and the nature of any adverse findings.
11.61. If the potential Client (or the Beneficial Owner) is identified in any adverse media or data leak screening, then the decision for establishing a Business Relationship or executing an Occasional Transaction shall require enhanced scrutiny of the natural or legal person subject to this Section of the Manual.
11.62. With respect to transactions or Business Relationships with Clients subject to this Section of the Manual, the CO shall:
11.62.1. apply enhanced due diligence measures for identifying and monitoring such Clients, as prescribed in this Manual;
11.62.2. collect adequate information so as to understand the Clients' profile;
11.62.3. take supplementary measures to verify or certify the documents supplied, or require confirmatory certification by a credit or financial institution;
11.62.4. conduct enhanced ongoing monitoring of the Business Relationship;
11.62.5. obtain adequate documentation to ascertain not only the identity of the said person but also to assess their business reputation (e.g. reference letters from banks or other reputable institutions);
11.62.6. seek and obtain information from the Client themselves or from publicly available information (incl. the reliable commercial electronic database used by the Company);
11.62.7. create the economic profile of the Client by obtaining the information specified in this Manual. The details of the expected business and nature of activities of the Client shall be specifically documented;
11.62.8. review on a risk-proportionate basis (at minimum as part of the annual comprehensive AML/CFT audit) the Client's trading account in order to determine whether to allow its continuance of operation. A short report shall be prepared and retained on file;
11.62.9. transactions with persons subject to this Section of the Manual, for which there is no apparent economic or visible lawful purpose, are further examined for the establishment of the background and purpose.
11.63. The CO should keep records of Clients subject to adverse media or data leak findings as prescribed in Appendix 5 below.
Client Identification and Due Diligence Procedures (Specific Cases)
11.64. The CO shall ensure that the appropriate documents and information with respect to the following cases shall be duly obtained, as applicable and appropriate:
Natural persons residing in the Republic of Seychelles
11.65. The Company shall obtain the following information to ascertain the true identity of the natural persons residing in the Republic:
11.65.1. true name and/or names used as these are stated on the official identity card or passport;
11.65.2. full permanent address in the Republic, including postal code;
11.65.3. telephone (home and mobile) and fax numbers;
11.65.4. e-mail address, if any;
11.65.5. date and place of birth;
11.65.6. nationality;
11.65.7. and details of the profession and other occupations of the Client including the name of employer or business organisation.
11.66. In order to verify the Client's identity or name, the Company shall request the Client to present an original document which is issued by an independent and reliable source.
11.67. It is provided that the Company shall be able to prove that the said document is issued by an independent and reliable source. In this respect, the CO shall be responsible for maintaining a list of acceptable identification documents.
11.68. The Client's permanent address shall be verified using one of the following ways:
11.68.1. visit at the place of residence (in such a case, the Company employee who carries out the visit prepares a memo which is retained in the Client's file);
11.68.2. and in addition to the above, the Company shall require and receive information on public positions which the prospective Client holds or held in the last twelve (12) months, to be approved by the Board. Details of such introductions are kept in the Client's file.
Natural persons not residing in Seychelles
11.69. The Company shall obtain the information required to ascertain the true identity of the natural persons not residing in Seychelles.
11.70. Furthermore, passports shall always be requested from the Clients not residing in Seychelles, and, if available, official national identity cards issued by the competent authorities of their country of origin shall be obtained. Certified true copies of the relevant documents shall be retained.
11.71. As a derogation to the general rule to request and obtain from Clients the documentation in order to verify a customer's identity orname and permanent address, the Company may accept other forms of reliable independent verification.
11.72. In addition to the aim of preventing Money Laundering and Terrorist Financing, the abovementioned information is also essential for implementing the financial sanctions imposed on specific persons pursuant to the Prevention of Terrorism Act, 2004 (as amended), the Prevention of Terrorism (Implementation of United Nations Security Council Resolutions on Suppression of Terrorism) Regulations, and United Nations Security Council Resolutions as adopted under the Law.
Joint accounts
11.73. In the cases of joint accounts of two or more persons, the identity of all individuals that hold or have the right to manage the account are verified.
Accounts of unions, societies, clubs, provident funds, and charities
11.74. In the case of accounts in the name of unions, societies, provident funds, and charities, the Company ascertains their purpose of operation and verifies their legitimacy by requesting the production of the articles and memorandum of association or procedure rules, and other founding documents.
Accounts of unincorporated businesses, partnerships, and other persons with no legal substance
11.75. In the case of unincorporated businesses, partnerships, and other persons with no legal substance, the identity of the directors, partners, Beneficial Owners, and other relevant persons is verified.
11.76. In addition, in the case of partnerships, the original or a certified true copy of the partnership's registration certificate shall be obtained.
11.77. The Company shall obtain documentary evidence of the head office address of the business, ascertain the nature and size of its activities, and receive all the information required for the construction of the economic profile.
11.78. The Company shall request, in cases where it exists, the formal partnership agreement and shall also obtain a mandate from the partnership authorising the opening of the account.
Accounts of legal persons
11.79. For Clients that are legal persons, the Company shall establish that the natural person appearing to act on their behalf is appropriately authorised to do so and their identity is verified.
11.80. The Company shall take all necessary measures for the full ascertainment of the legal person's control and ownership structure as well as the verification of the identity of the Beneficial Owners.
11.81. The verification of the identification of a legal person that requests the establishment of a Business Relationship or the execution of an Occasional Transaction comprises the ascertainment of the following:
11.81.1. the registered number;
11.81.2. the registered corporate name and trading name used;
11.81.3. the full addresses of the registered office and the head offices;
11.81.4. the telephone numbers, fax numbers, and e-mail address;
11.81.5. the members of the board of directors;
11.81.6. the individuals who are duly authorised to operate the account and to act on behalf of the legal person;
11.81.7. the Beneficial Owners of private companies and public companies that are not listed in a Regulated Market of a country, with equivalent disclosure and transparency requirements;
11.81.8. the registered shareholders that act as nominees of the Beneficial Owners;
11.81.9. the economic profile of the legal person.
11.82. For the verification of the identity of the legal person, the Company shall request and obtain, among others, original or certified true copies of the following documents:
11.82.1. certificate of incorporation and certificate of good standing (where available) of the legal person;
11.82.2. certificate of registered office;
11.82.3. certificate of directors and secretary;
11.82.4. certificate of registered shareholders in the case of private companies and public companies that are not listed in a Regulated Market with equivalent disclosure and transparency requirements;
11.82.5. memorandum and articles of association of the legal person;
11.82.6. a resolution of the board of directors of the legal person for the opening of the account and granting authority to those who will operate it;
11.82.7. in the cases where the registered shareholders act as nominees of the Beneficial Owners, a copy of the trust deed or agreement concluded between the nominee shareholder and the Beneficial Owner, by virtue of which the registration of the shares in the nominee shareholder's name on behalf of the Beneficial Owner has been agreed;
11.82.8. documents and data for the verification of the identity of the persons that are authorised by the legal person to operate the account, as well as the registered shareholders and Beneficial Owners of the legal person.
11.83. Where deemed necessary for a better understanding of the activities, sources, and uses of funds/assets of a legal person, the Company shall obtain copies of its latest audited financial statements (if available), and/or copies of its latest management accounts.
11.84. For legal persons incorporated outside the Republic, the Company requests and obtains documents similar to the above.
11.85. As an additional due diligence measure, on a risk-sensitive basis, the Company shall carry out (when deemed necessary) a search and obtain information from the records of the Registrar of Companies of the country of incorporation (for foreign companies) and/or request information from other sources in order to establish that the applicant company (legal person) is not, nor is in the process of being struck off from the Registrar of Companies and Official Receiver, and that it continues to be registered as an operating company.
11.86. It is pointed out that, if at any later stage any changes occur in the structure or the ownership status orany details of the legal person, or any suspicions arise, the Company shall take appropriate steps.
11.88. In the case of a Client-legal person that requests the establishment of a Business Relationship or the execution of an Occasional Transaction and whose direct or immediate principal shareholder is another legal person, registered in the Republic or abroad, the Company, before establishing a Business Relationship or executing an Occasional Transaction, shall verify the ownership structure and the identity of the Beneficial Owners through the chain of ownership.
11.89. Apart from verifying the identity of the Beneficial Owners, the Company shall identify the persons who have the ultimate control over the legal person's business and assets. In the cases that the ultimate control rests with the persons who have the power to manage the funds, accounts or investments of the legal person without requiring authorisation and who would be in a position to override the internal procedures of the legal person, the Company shall verify the identity of the natural persons who exercise ultimate control as described above even if those persons have no direct or indirect interest or an interest of less than 10% in the legal person's ordinary share capital or voting rights.
11.90. In cases where the Beneficial Owner of a legal person, requesting the establishment of a Business Relationship or the execution of an Occasional Transaction, is a trust:
11.90.1. the Company shall ascertain the legal substance, the name, and the date of establishment of the trust and verify the identity of the trust, trustee, and Beneficial Owners;
11.90.2. furthermore, the Company shall ascertain the nature of activities and the purpose of establishment of the trust, as well as the source and origin of funds. All documentation shall be retained in the Client's file.
Investment funds, mutual funds, and firms providing financial or investment services
11.91. The Company shall establish and maintain Business Relationships or execute Occasional Transactions with persons who carry out the above services and activities which are incorporated and/or operating in countries that, according to a relevant determination, apply equivalent Anti-Money Laundering requirements, provided that the said persons satisfy the conditions below.
11.92. The said persons shall:
11.92.1. possess the necessary licence or authorisation from a competent supervisory or regulatory authority of the country of their incorporation and operation;
11.92.2. and be subject to supervision for the prevention of Money Laundering, Terrorist Financing, and Proliferation Financing purposes.
11.93. In the case of the establishment of a Business Relationship or the execution of an Occasional Transaction with persons who carry out the above services and activities and which are incorporated and/or operating in a third country other than those recognised, the Company shall obtain, in addition to the identification of the Beneficial Owners, the following:
11.93.1. a copy of the licence or authorisation granted to the said person from a competent supervisory or regulatory authority of its country of incorporation and operation;
11.93.2. in the case of investment funds and mutual funds, the Company, apart from identifying the fund itself, shall also identify and verify the identity of the fund's Beneficial Owners.
Nominees or agents of third persons
11.94. The Company shall take reasonable measures to obtain adequate documents, data, or information for the purpose of establishing and verifying the identity of:
11.94.1. the nominee or the agent of the third person;
11.94.2. and any third person on whose behalf the nominee or the agent is acting.
11.95. In addition, the Company shall obtain a copy of the authorisation agreement that has been concluded between the interested parties.
Reliance on Third Persons for Client Identification and Due Diligence Purposes
11.96. The Company may rely on third persons for Client identification procedures and due diligence measures, provided that:
11.96.1 the third person provides certified true copies of all data, information, and documents obtained through the CDD process within 3 working days of a written request by the Company ;
11.96.2 the Company applies the appropriate due diligence measures on the third person with respect to their professional registration and procedures and measures applied for the prevention of Money Laundering, Terrorist Financing, and Proliferation Financing;
11.96.3. the ultimate responsibility for meeting those requirements of Client identification and due diligence shall remain with the Company.
11.97. The Company shall not rely on a third person unless a formal Written Agreement has been concluded between the Company and the third person. The Written Agreement shall, at a minimum, set out:
11.97.1. the specific CDD and identification obligations delegated to the third person;
11.97.2 the obligation of the third person to make available certified true copies of relevant CDD documentation within 3 working days of a written request;
11.97.3 the obligation of the third person to maintain adequate records in accordance with the requirements of the AML/CFT Act 2020 and AML/CFT Regulations 2020;
11.97.4. the obligation of the third person to give not less than 30 days' written notice to the Company before ceasing to carry on the relevant business activities or before terminating the arrangement;
11.97.5. and the obligation to comply with applicable AML/CFT laws and to notify the Company immediately of any material change in its regulatory status or compliance posture. The foregoing replaces any informal authorisation arrangement that may previously have been in place.
11.98. The CO shall conduct periodic review and testing of each reliance arrangement to verify that the third person is maintaining CDD records in accordance with the terms of the Written Agreement and applicable law, and that the third person is able to retrieve and transmit those records without undue delay. The frequency of such reviews shall be commensurate with the risk profile of the arrangement and shall be documented in the CO's records. Where a review identifies that the third person is unable or unwilling to comply with the arrangement, the Company shall immediately cease relying on that third person and shall take steps to obtain the relevant CDD documentation directly from the Client.
11.99. For the purposes of this Section of the Manual, 'third person' means credit institutions, or financial institutions, or auditors, or accountants, or tax consultants, or independent legal professionals, or trust and company service providers.
11.100. 'Third person' for the purposes of this Section of the Manual may also be any other person who is engaged in financial business or 'Other Business Activities' and who operates in countries which, according to a relevant decision of the FIU, have been determined to impose equivalent Anti-Money Laundering and Terrorist Financing obligations.
11.101. It is provided that the abovementioned third persons have to fulfil the requirements set out in point 11.97. above and are subject to supervision as regards their compliance with those requirements.
11.102. The Company must request from the third party to:
11.102.1. provide certified true copies of all data, information, and documents obtained through the CDD process within 3 working days of a written request by the Company, obtained as a result of the application of the procedures establishing identity and customer due diligence;
11.102.2. and forward to the Company, within 3 working days of request, copies of those documents and relevant information on the identity of the customer or the Beneficial Owner which the third party collected during the identification process.
11.103. The Company may rely on third persons only at the outset of establishing a Business Relationship or the execution of an Occasional Transaction for the purpose of verifying the identity of their Clients. According to the degree of risk, any additional ongoing due diligence shall be carried out by the Company itself.
11.104. In addition, in the case where the third person is an auditor, accountant, tax consultant, independent legal professional or a trust and company service provider operating in a country that does not apply equivalent requirements for the prevention of Money Laundering and Terrorist Financing (see Appendix 4 for the list of equivalent third countries), then the Company, before accepting the Client identification data verified by the said third person, shall apply the following additional measures or procedures:
11.104.1. the CO or the appointed person shall assess and evaluate, according to Section 6 of this Manual, the systems and procedures applied by the third person for the prevention of Money Laundering and Terrorist Financing, as applicable;
11.104.2. as a result of the assessment of point (a) above, the CO must be satisfied that the third person implements Client identification and due diligence systems and procedures at least equivalent to those required by the Law;
11.104.3. the CO shall maintain a separate file for every third person of the present paragraph, where it stores the assessment report of point (a) and other relevant information;
11.104.4. the commencement of the cooperation with the third person and the acceptance of Client identification data verified by the third person is subject to approval by the CO.
11.105. For the purposes of this Section of the Manual, the terms financial institutions and persons engaged in financial business activities do not include currency exchange offices.
11.106. The CO shall be responsible for the implementation of the provisions mentioned in this Section of the Manual.
11.107. The Internal Auditor shall be responsible to review the adequate implementation of the provisions mentioned herein as part of the annual comprehensive AML/CFT audit.
12. ONGOING MONITORING PROCESS
General
12.1. The Company has a full understanding of normal and reasonable account activity of its Clients as well as of their economic profile and has the means of identifying transactions which fall outside the regular pattern of an account''s activity or to identify complex or unusual transactions.
12.2. In this respect, the CO shall be responsible for maintaining as well as developing the ongoing monitoring process of the Company. The Internal Auditor shall review the Company's procedures with respect to the ongoing monitoring process, at least annually.
Procedures
12.3. The procedures and intensity of monitoring Clients' accounts and examining transactions based on the Client's level of risk shall include the following:
12.3.1. the identification of:
12.3.1.1. all high-risk Clients, as applicable; the Company shall be able to produce detailed lists of high-risk Clients, so as to facilitate enhanced monitoring of accounts and transactions;
12.3.1.2. transactions which, by their nature, may be associated with Money Laundering or Terrorist Financing;
12.3.1.3. unusual or suspicious transactions that are inconsistent with the economic profile of the Client, for the purposes of further investigation;
12.3.1.4. in case of any unusual or suspicious transactions, the head of the department providing the relevant Licensed Services or any other person responsible (e.g. Administration or the Back Office Department) shall be responsible to communicate with the CO;12.3.2. further to point 12.3.1 above, the investigation of unusual or suspicious transactions by the CO. The results of the investigations are recorded in a separate memo and kept in the Client's file;
12.3.3. the ascertainment of the source and origin of the funds credited to accounts;
12.3.4. the ongoing monitoring of the business relationship in order to determine whether there are reasonable grounds to suspect that Client accounts contain proceeds derived from criminal conduct;
12.3.5. the use of appropriate and proportionate IT systems, including:
12.3.5.1. adequate automated electronic management information systems which will be capable of supplying the Board of Directors and the CO, on a timely basis, all the required management information;
12.3.5.2. for all accounts, automated electronic management information systems to add up the movement of all related accounts on a consolidated basis and detect unusual or suspicious patterns of transactions;
12.3.6. the monitoring of accounts and transactions in relation to specific types of transactions and the economic profile, as well as by comparing the actual transactions periodically with the expected activity as set out in the Client's economic profile.
13. RECOGNITION AND REPORTING OF SUSPICIOUS TRANSACTIONS OR ACTIVITIES TO THE FIU
Reporting of Suspicious Transactions to the FIU
13.1. The Company, in cases where there is an attempt of executing transactions which it knows or suspects are related to Money Laundering or Terrorist Financing, reports, through the CO, its suspicion to the FIU.
Tipping-Off Prohibition
13.2. Once a Suspicious Transaction Report (STR) has been submitted, or where the Company knows or suspects that an investigation into Money Laundering or Terrorist Financing is being or is about to be conducted, the CO and all employees of the Company are strictly prohibited from disclosing to the Client concerned or to any third party:
13.2.1. that an STR has been or is about to be made;
13.2.2. that information has been provided to the FIU, or
13.2.3. that an investigation is being or may be conducted.
13.3. Breach of this prohibition is a criminal offence under the AML/CFT Act, 2020. Where the Company reasonably believes that conducting or completing a CDD procedure would itself constitute a tipping-off of the Client, the CDD procedure shall not be pursued and an STR shall be filed with the FIU immediately in accordance with section 48 of the AML/CFT Act, 2020.
Suspicious Transactions
13.4. The definition of a suspicious transaction as well as the types of suspicious transactions which may be used for Money Laundering and Terrorist Financing are set out with reference to the economic profile that the Company has created for the Client. The Company shall ensure that it maintains adequate information and knows enough about its Clients' activities in order to recognise suspicious transactions. Examples of transactions that may be used for Money Laundering and Terrorist Financing are listed in Appendix 3 of the Manual. The relevant list is not exhaustive, nor does it include all types of transactions that may be used.
13.5. The CO shall:
13.5.1. receive and investigate information from the Company's employees on suspicious transactions which create the belief or suspicion of Money Laundering. This information is reported on the Internal Suspicion Report. The said reports are archived by the CO;
13.5.2. if as a result of the evaluation described above, the CO decides not to disclose the relevant information to the FIU, then they shall fully explain the reasons for their decision on the Internal Evaluation Report.
CO's Report to the FIU
13.6. After the submission of a suspicion report, the Company may subsequently wish to terminate its relationship with the Client concerned for risk avoidance reasons.
13.7. After submitting the suspicion report, the Company adheres to any instructions given by the FIU and, in particular, as to whether or not to continue or suspend a particular transaction or Business Relationship.
13.8. The FIU may instruct the Company to refrain from executing or delay the execution of a Client's transaction without such action constituting a violation of any contractual or other obligation of the Company and its employees.
13.9. Furthermore, after the submission of a suspicion report, the Clients' accounts concerned as well as any other connected accounts are placed under the close monitoring of the CO.
Submission of Information to the FIU
13.10. The Company shall ensure that in the case of a suspicious transaction investigation by the FIU, the CO will be able to provide, without delay, the following information:
13.10.1. the identity of the account holders;
13.10.2. the identity of the Beneficial Owners of the account;
13.10.3. the identity of the persons authorised to manage the account;
13.10.4. data of the volume of funds or level of transactions flowing through the account;
13.10.5. connected accounts;
13.10.6. in relation to specific transactions:
13.10.6.1. the origin of the funds;
13.10.6.2. the type and amount of the currency involved in the transaction;
13.10.6.3. the form in which the funds were placed or withdrawn, for example, cash, cheques, or wire transfers;
13.10.6.4. the identity of the person who gave the order for the transaction;
13.10.6.5. the destination of the funds;
13.10.6.6. the form of instructions and authorisation that have been given;
13.10.6.7. the type and identifying number of any account involved in the transaction.
14. RECORD-KEEPING PROCEDURES
General
14.1. The Administration or the Back-Office Department of the Company shall maintain records of:
14.1.1. the Client identification documents and information obtained during the Client identification and due diligence procedures, as applicable, and
14.1.2. the details of all relevant records with respect to the provision of Licensed Services to Clients.
14.2. The documents or data mentioned above shall be kept for a period of at least 7 years (per section 42 of the AML/CFT Act 2020), calculated from the date of the execution of the transaction or the termination of the Business Relationship.
14.3. It is provided that the documents or data mentioned in points 14.1.1 and 14.1.2 above, which may be relevant to ongoing investigations, shall be kept by the Company until the FIU instructs otherwise.
Format of Records
14.4. The Administration or the Back-Office Department may retain the documents or data mentioned in Section 14.1 of the Manual, other than the original documents or their Certified true copies that are kept in a hard copy form, in other forms such as electronic form, provided the relevant requirements are met.
14.5. In case the Company establishes a documents or data retention policy, the CO shall ensure that the said policy shall take into consideration the requirements of the Law and the Regulations.
14.6. The Internal Auditor shall review the adherence of the Company to the above as part of the annual comprehensive AML/CFT audit.
Certification and language of documents
14.7. The documents or data obtained shall be in their original form or in a certified true copy form. In the case that the documents or data are certified as true by a different person, the identity and capacity of the certifying person shall be recorded.
14.8. A true translation shall be attached in the case that the documents referred to above are in a language other than English.
14.9. Each time the Company proceeds with the acceptance of a new Client, the Head of the Administration or the Back-Office Department shall be responsible for ensuring compliance with the provisions of points 14.7 and 14.8 above.
15. EMPLOYEES' OBLIGATIONS, EDUCATION, AND TRAINING
Employees' Obligations
15.1. The Company's employees shall be personally liable for failure to report information or suspicion regarding Money Laundering or Terrorist Financing;
15.1.1. the employees must cooperate and report, without delay, anything that comes to their attention in relation to transactions for which there is a slight suspicion that are related to Money Laundering or Terrorist Financing;
15.1.2. according to the Law, the Company's employees shall fulfil their legal obligation to report their suspicions regarding Money Laundering, Terrorist Financing, and Proliferation Financing, after following the relevant internal reporting procedures.
Education and Training
Employees' Education and Training Policy
15.2. The Company shall ensure that its employees are fully aware of their legal obligations according to the Law and the Regulations, by introducing a complete employees' training program;
15.2.1. the timing and content of the training provided to the employees of the various departments will be determined according to the needs of the Company;
15.2.2. the training program aims at educating the Company's employees on the latest developments in the prevention of Money Laundering, Terrorist Financing, and Proliferation Financing, including updates to legislation and typologies;
15.2.3. the training program will have a different structure for new employees, existing employees and for different departments of the Company according to the services they provide. The CO shall be responsible to refer to the relevant details and information in their Annual Report.
CO Education and Training Program
15.3. The Senior Management of the Company shall be responsible for ensuring the CO of the Company attends external training. Based on their training, the CO will then provide training to other employees.
15.4. The main purpose of the CO training is to ensure that relevant employee(s) become aware of:
15.4.1. the Anti-Money Laundering Act and guidelines;
15.4.2. the Company's Anti-Money Laundering Policy.
15.5. The CO shall be responsible to include information in respect of their education and training program(s) attended during the year in their Annual Report.
16. BENEFICIAL OWNERSHIP ACT 2020
16.1. The Beneficial Ownership Act 2020 (Act 4 of 2020), which came into force on 28 August 2020 alongside the AML/CFT Act 2020, establishes a comprehensive framework for the identification, verification, and maintenance of Beneficial Ownership information in Seychelles. The Company shall comply with the requirements of the Beneficial Ownership Act 2020 and its associated Regulations as part of its overall AML/CFT framework.
16.2. Key obligations under the Beneficial Ownership Act 2020 include:
16.2.1. maintaining an up-to-date Register of Beneficial Owners (RBO) at the Company's registered office, containing the names, residential addresses, dates of birth, nationalities, and identification documents of all Beneficial Owners;
16.2.2. identifying and verifying the identity of Beneficial Owners, being natural persons who ultimately own or control, whether directly or indirectly, 10% or more of the controlling ownership interest (including shares or voting rights) of the Company;
16.2.3. ensuring Beneficial Ownership information is submitted to the FIU-maintained Seychelles Beneficial Ownership Database through the Company's registered agent;
16.2.4. updating the RBO within 14 days of any change in Beneficial Ownership particulars;
16.2.5. cooperating with requests from competent authorities, including the FIU, FSA, Anti-Corruption Commission, and law enforcement agencies, for access to Beneficial Ownership information.
16.3. The CO shall ensure that the Company's CDD procedures incorporate the requirements of the Beneficial Ownership Act 2020 and that all relevant staff are trained on their obligations under this legislation.
17. PROLIFERATION FINANCING AND VIRTUAL ASSETS
Proliferation Financing
17.1. In accordance with the AML/CFT Act, 2020, FATF Recommendation 7, and the applicable United Nations Security Council Resolutions on proliferation financing, the Company shall implement measures to prevent the financing of proliferation of weapons of mass destruction. The Company shall:
17.1.2. screen all customers and transactions against the United Nations Security Council Consolidated Sanctions List relating to proliferation financing;
17.1.3. implement targeted financial sanctions without delay in relation to persons and entities designated by UN Security Council Resolutions concerning proliferation of weapons of mass destruction;
17.1.4. freeze without delay the funds or other assets of designated persons and entities, and ensure that no funds or other assets are made available to or for the benefit of designated persons or entities;
17.1.5. report any attempted or completed transactions involving designated persons or entities to the FIU immediately.
Virtual Assets and Virtual Asset Service Providers (VASPs)
17.2. In line with the Seychelles National Risk Assessment and FATF Recommendation 15 (Virtual Assets) and Recommendation 16 (the Travel Rule), the Company shall apply enhanced vigilance to transactions involving virtual assets or Virtual Asset Service Providers (VASPs). Where the Company's services involve or interact with virtual assets, the Company shall:
17.2.1. apply the same CDD and ongoing monitoring requirements to transactions involving virtual assets as apply to traditional financial transactions;
17.2.2. assess the ML/TF risks associated with virtual asset transactions, including the risk of anonymity, cross-border transfer, and rapid settlement;
17.2.3. when dealing with VASPs, verify that the VASP is registered or licensed in its jurisdiction and subject to adequate AML/CFT supervision;
17.2.4. apply enhanced due diligence to high-risk virtual asset transactions, including those involving privacy coins, mixing services, or unhosted wallets.
17.3. Where a Suspicious Transaction Report involves virtual assets, the report submitted to the FIU through the goAML platform shall, in addition to the standard STR content requirements, include the following information in accordance with the AML/CFT Regulations 2020 as amended by S.I. 67 of 2024 (in force 6 September 2024):
17.3.1. the type and address of the wallet(s) involved, including whether the wallet is hosted or unhosted (self-custodied), and the nature of the virtual assets concerned;
17.3.2. the IP addresses of the relevant parties associated with the transaction, where available;
17.3.3. the transaction hash or hashes uniquely identifying the relevant on-chain transaction(s).
18. ADDITIONAL COMPLIANCE OBLIGATIONS
Alternate Compliance Officer (ACO)
18.1. Pursuant to section 34(2) of the AML/CFT Act 2020 and FSA Circular No. 8 of 2024, the Company shall appoint a senior official at management level as the Alternate Compliance Officer (ACO), approved by the FSA, to act in the absence of the CO. The ACO shall:
18.1.1. meet the fit and proper criteria prescribed under Regulation 11(1) and the First Schedule of the AML/CFT Regulations 2020, including at least 2 years' experience in Anti-Money Laundering or compliance-related functions;
18.1.2. assume the full responsibilities of the CO during the CO's absence, including the authority to file Suspicious Transaction Reports with the FIU;
18.1.3. be approved by the FSA prior to assuming the role, with the application submitted at least 60 days prior to the planned appointment.
18.2. Upon the ACO assuming the functions of the CO, the Company shall notify the Financial Services Authority (FSA) as the supervisory authority. Where the assumption of the CO's functions is unplanned, such notification shall be made as soon as practicable. A threshold of more than 5 consecutive business days of assumption before notification is required is cited in FSA Circular No. 8 of 2024.
18.3. The 90-day period prescribed by Regulation 10(c) of the AML/CFT Regulations 2020 applies to the deadline within which the Company must complete the appointment of a new substantive CO following the withdrawal of an existing CO's approval by the FSA. This period does not constitute an authorised acting period for the ACO. The ACO's authority to assume the CO's functions derives from section 34(2) of the AML/CFT Act 2020 and is subject to the terms of this Section and the conditions of the ACO's FSA approval. Any reference in this Manual to a 90-day ACO acting period should be read accordingly.
FIU Registration
18.4. In accordance with section 31 of the AML/CFT Act 2020 and FIU Circular No. 5 of 2020, the Company shall register with the Financial Intelligence Unit within 60 days of commencement of its operations. The Company shall maintain its FIU registration current and notify the FIU of any material changes to its operations or status.
goAML Reporting Platform
18.5. The Company shall utilise the FIU's goAML reporting platform for the electronic submission of all Suspicious Transaction Reports (STRs), Cash Transaction Threshold Reports, and Wire Transfer Threshold Reports. The CO shall ensure that relevant staff are trained on the use of the goAML system and that the Company's goAML account is maintained with current authorised users.
Wire Transfer and Cash Transaction Threshold Reporting
18.6. The Company shall report to the FIU all cash transactions and wire transfers that meet or exceed the threshold prescribed from time to time in the Third Schedule of the Anti-Money Laundering and Countering the Financing of Terrorism Act 2020 (Cap. 251), as amended, or the equivalent value in any foreign currency, in accordance with section 5 of that Act. Reports shall be submitted through the official platform in the form and manner prescribed by the FIU's applicable guidelines, as issued and revised from time to time.
18.7. Separately, in respect of every wire transfer, the Company shall record and retain the identification details required under section 45 of the AML/CFT Act 2020 and Regulation 16A of the AML/CFT Regulations 2020, including as a minimum: the originator's full name; the originator's account number; the originator's address, national identity number, or date of birth; the beneficiary's full name; and the beneficiary's account number. These details shall travel with the transfer and be retained in accordance with the Company's record retention obligations under section 47 of the Act.
National Risk Assessment
18.8. In accordance with the AML/CFT (National Risk Assessment) Regulations 2022, the Company shall have regard to the findings of the Seychelles National Risk Assessment for Money Laundering, Terrorist Financing and Proliferation Financing when conducting its own institutional risk assessment. The Company shall ensure that its risk assessment methodology, CDD measures, and ongoing monitoring procedures are calibrated to the national-level risks identified in the NRA, including sectoral vulnerabilities specific to the foreign exchange and securities sectors.
Prevention of Terrorism Act 2004
18.9. The Company shall comply with the Prevention of Terrorism Act 2004 (as amended through 2024) and the Prevention of Terrorism (Implementation of United Nations Security Council Resolutions on Suppression of Terrorism) Regulations. The Company shall screen all customers and transactions against UN Security Council designations relating to terrorism and shall freeze without delay the assets of any designated person or entity. Any suspicion of Terrorist Financing shall be reported to the FIU immediately.