KNOW YOUR CLIENT (KYC) POLICY & PROCEDURE - WALLEX BANK
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KNOW YOUR CLIENT (KYC)
POLICY & PROCEDURE
July 2021
WALLEX BANK
Registered in Union of the Comoros. Registered number C 21389. Registered Office: Suite 1077 BP 304, Moroni, Grand
Comore, Union of the Comoros
Wallex Bank has been issued with an International Banking License number: L 21389 / WBTable of Contents 1 INTRODUCTION.............................................................................................................................................. 3 1.1 PURPOSE............................................................................................................................................... 3 1.2 SCOPE.................................................................................................................................................... 3 1.3 ANNUAL REVIEW & RECORDS RETENTION....................................................................................... 3 2 KYC PROCEDURE.......................................................................................................................................... 4 2.1 CLIENT REGISTRATION (“INITIAL CONTACT”).................................................................................... 4 2.2 COLLECTING FURTHER INFORMATION / DOCUMENTS.................................................................... 4 2.2.1 Verifying Company Registration / Structure.................................................................................... 4 2.2.2 Verifying Identity............................................................................................................................. 5 2.3 IDENTITY DOCUMENT CHECKING PROCEDURE............................................................................... 6 2.4 ENHANCED DUE DILIGENCE............................................................................................................... 9 2.4.1 Regulated Clients........................................................................................................................... 9 2.4.2 Risk Based Approach................................................................................................................... 10 2.5 SANCTIONS SCREENING................................................................................................................... 10 2.5.1 Sanctions Screening by Third-party Providers............................................................................. 10 2.5.2 Screening of Individual Transactions............................................................................................ 10 2.5.3 Escalation..................................................................................................................................... 10 2.6 POLITICALLY EXPOSED PERSON CHECKS.......................................................................................11 2.6.1 PEP Screening by Third-party Providers.......................................................................................11 2.6.2 Escalation......................................................................................................................................11 2.7 FURTHER DETAILS COLLECTED FROM CLIENTS............................................................................ 12 2.7.1 Definition of User Roles................................................................................................................ 12 APPENDIX A – DOCUMENTS REQUIRED BY BUSINESS TYPE............................................................................ 13 LLC / LTD / UAB OR EQUIVALENT............................................................................................................................. 13 PARTNERSHIP........................................................................................................................................................... 13 LIMITED BY GUARANTEE......................................................................................................................................... 14 APPENDIX B - ACCEPTABLE DOCUMENTS FOR IDENTITY VERIFICATION....................................................... 14 ID DOCUMENTS......................................................................................................................................................... 14 SECONDARY ID DOCUMENTS................................................................................................................................. 14 Identification Documents............................................................................................................................................. 14 Financial Statements................................................................................................................................................... 14 Letters from Government Bodies................................................................................................................................. 14 Bills.............................................................................................................................................................................. 14 Third Party Electronic Identity Verification................................................................................................................... 15 SOURCE OF FUNDS VERIFICATION........................................................................................................................ 15 APPENDIX C - INDICATORS OF SUSPICIOUS ACTIVITY....................................................................................... 16 CRITERIA OF SUSPICIOUS TRANSACTIONS.......................................................................................................... 16 July 2021 | 2
1 INTRODUCTION
1.1 Purpose
In order to align with WALLEX BANK (“WALLEX BANK” or “Company”) efforts to maintain an effective
anti-money laundering and counter terrorist financing (“AML/CTF”) program, WALLEX BANK employs
the Know Your Client (“KYC”) policy and procedure.
KYC is used to risk assess indicators of perceived money laundering risk at the Client level. This is
accomplished by establishing various risk indicators and identifying Clients who behave in the outlier
ranges of these indicators. This KYC process enables WALLEX BANK to adequately identify higher risk
Clients and to take appropriate action to mitigate the risks.
KYC policies are essential to any financial institution and are fundamental to an AML program. From
WALLEX BANK’s perspective, knowing whom we do business with can prevent individual transaction
instances of inadvertently facilitating money laundering and/or other crimes. An inadequate Know Your
Client system can result in WALLEX BANK as a limited entity, as well as individual employees, being
subject to civil and/or criminal penalties. Such penalties can vary from country to country.
The 5 thEuropean AML Directive (AMLD 5), The Money Laundering, Terrorist Financing and Transfer of
Funds Regulations 2017 (United Kingdom) and Anti-Money Laundering and Combating the Financing
of Terrorism 2004 (AML/CFT) for Union of the Comoros are the primary pieces of legislation that drive
the WALLEX BANK KYC framework. Clients go through the KYC process during their on-boarding
and are not allowed to transact until their on- boarding process is completed.
The KYC program includes:
• Risk-based requirements for Clients dependent on Client’s risk category
• Measures to identify Sanctioned individuals and take appropriate action
• Measures to identify and manage Politically Exposed Persons (“PEPs”)
• Keeping Client Due Diligence information up to date
1.2 Scope
This procedure is applicable to all WALLEX BANK Clients. The Compliance Department employs
and oversees these procedures.
1.3 Annual Review & Records Retention
This document is owned by the Compliance Department and is reviewed and updated annually or
when there are significant changes to the policy/procedure.
Records of this procedure, which include but are not limited previous versions, are kept for at leastfive
years beginning on the date on which the document was approved.
July 2021 | 32 KYC PROCEDURE
2.1 Client Registration (“Initial Contact”)
Clients who are interested in using WALLEX BANK services are first required to provide various
information from which an on-boarding form is completed by the Client Services department. This step
includes:
• Completing the Account Application Form (the “Questionnaire”)
• Obtaining company registration information
• Obtaining details on the company management, owners, etc.
• Obtaining a signed Service Agreement
2.2 Collecting Further Information / Documents
Identification documents will be obtained before the authorization of any transactions in the business
relationship. Identification includes verifying the Client’s existence, their name and address, and
establishing their ownership, control and structure. This means confirming who their directors are and
their beneficial ownership. Appendix A includes a non-exhaustive list of documents that may be required
from various business types and structures (e.g. partnerships, trusts, etc.).
2.2.1 Verifying Company Registration / Structure
Upon obtaining Company Registration details, the Client Services Representative (“CSR”) is required
to verify the information using the European Business Register (“EBR”) or equivalent database (e.g.
Companies House in the United Kingdom). During this verification, the information provided by the
Client is checked against the government databases to ensure that the two are aligned. Web printouts
of these database searches are kept. If any discrepancies are identified during this step, the CSR
contacts the Client to obtain clarification and documents the interactions within the Client profile.
2.2.1.1 Articles of Association
When dealing with more complex company structures and in cases where limited information isavailable
through government registers - Articles of Association may be requested to ensure that WALLEX
BANK Is aware of the entirety of the Client’s management structure. For example, complex structures
may include but are not limited to cases when there are (a) more than two directors, (b) directors
completely differ from owners, (c) companies that are owned by other companies.
July 2021 | 42.2.2 Verifying Identity
A core part of the on-boarding process is verifying the identity of the Client’s representative (the “Authorized
Representative”) who is either (a) the director of the company or (b) the Authorized representative of
the company and/or (c) other individual that is determined to have a senior management role (based
on Client’s Articles of Association).
Generally, the information collected on the identity is as follows:
Type Information Required Documents Required
Director(-s) -Name, date of birth, • A Photo ID document in (with
residential address, proof of identity including a date
citizenship of birth)
Authorized -Name, date of birth, • Authorization from the Director of
Signatory(-ies) residential addresses, the company to carry out financial
citizenship operations
• A Photo ID document (with proof of
identity including a date of birth)
Beneficial -Legal Name, Address, • The following information on the
Owners (10% Unique Identification ultimate beneficial owners (natural
or more of number, persons) also need to be collected:
shares) -Further information may name, surname, date of birth, citizen-
be required on owners on ship
a risk-based approach. • A Photo ID document (with proof of
identity including a date of birth)
In terms of beneficial ownership, every Beneficial Owner is asked whether they are acting in their own
capacity or on behalf of another person. If they are acting for another person then WALLEX BANK will
require details of such.
2.2.2.1 Acceptable documents for Identity Verification
List of acceptable documents can be found in Appendix B of this document
2.2.2.2 Face-to-Face Identity Verification
When accepting evidence of identity from an Authorized Representative during a face-to-face meeting,
it is important to make sufficient checks on the evidence provided. Usual checks on photo IDmay include:
• Visual likeness against the Authorized Representative
• Does the date of birth on the evidence match the apparent age of the Authorized Representative?
• Is the ID valid?
July 2021 | 5• Is the spelling of names the same as other documents provided by the Client? Checks on secondary evidence of ID may include: • Do the addresses match the address given on the photo ID? • Does the name of the Authorized Representative match with the name on the photo ID? Copies are made of the original documents reviewed during the face-to-face meeting and each copy is signed by the WALLEX BANK employee who viewed the original documents. 2.2.2.3 Original Seen Verification Where a face-to-face meeting with the Client is not possible, ID Documents can be certified true copies of the original by appropriate persons. Appropriate persons are: • Notary Publics • Members of Designated Supervised Bodies (as listed by the Office for Professional Body Anti- Money Laundering Supervision or OPBAS - https://www.fca.org.uk/opbas). This includes lawyers, accountants and bookkeepers. • Bank officers • Post Office Document Certification Service The appropriate person should sign and date a copy of the personal identification or other document, and state that this document is a true copy of the original (or words to that effect). The date has to be within the last six months (and the identification document has to be currentlyvalid). 2.2.2.4 Live Video Verification Alternatively live video verification can also be used. This identifies Authorized Representatives remotely using electronic media that allows live video transmission enabling capturing the image of the Client representative’s face and the original of the identity document of such representative. During this video transmission two screenshots are taken by the CSR – 1. Client’s ID and 2. The Client holding the ID (where both ID and face of the client are visible). As with Face-to-Face Identity Verification discussed in section 2.2.2.2 – Visual likeness and secondary evidence checks must be performed before verifying the identity of the Authorized Representative. 2.2.2.5 Verification of Client’s Bank Account As an additional verification measure, WALLEX BANK requests that the Client’s first payment is made from the account with a credit institution registered in a European Union Member State or a third July 2021 | 6
country that enforces requirements on a par with those imposed by the Law on Prevention of Money
Laundering and Terrorist Financing and is subject to authority supervision for compliance thereto.
The name that is on this bank account must match that of the Client’s business name that is being
registered with WALLEX BANK. Any discrepancies therein must be reviewed and documented.
2.3 Identity Document Checking Procedure
All steps outlined below are performed by CSRs, unless otherwise stated:
1. The CSR reviews the provided document to ensure that the document is visible in its entirety
and that all details are clear.
a. If the document is an ID, the document has to be valid (expiration date has not passed), all the
numbers and photographs must be visible and the document must be on the list of acceptable ID
documents outlined in Appendix B
i. The CSR also looks to ensure that the document does not appear to be altered in any way and that
it fits the expected ID format.
ii. When necessary, the CSR also consults with the Public Register of Authentic Travel and Identity
Documents Online to better ensure that the provided document appears valid.
b. If the document is a bill or letter used as Secondary ID, it has to be visible in its entirety, the date on it
cannot be older than defined in Appendix B
c. If the document is a bank statement, the document needs to be visible in its entirety, the name of the
Authorized Representative needs to be visible (on at least one page if it is a multi-page document)
and it must be on the list of acceptable Source of Funds documents in Appendix B
i. Only details that can be obfuscated from the documents are ones that are not pertinent to the check
being performed (e.g. full credit card/CVV numbers, unrelated transactions)
d. All other provided documents must be clearly visible and must display the name of the Client on at
least one of the pages
i. Again, only details that can be obfuscated from the documents are ones that are not pertinent to
the check being performed (e.g. full credit card/CVV numbers, unrelated transactions)
2. If the document does not meet one of the requirements outlined in step 1, the CSR rejects the
document, informs the Client on the reason behind the rejection and requests a valid copy of
the document.
a. If the Client is not able to provide an acceptable copy of the requested document, the account cannot
be opened
July 2021 | 7b. If the Client is unable to provide the requested information and his or her transaction appears
suspicious and or indicative of Money Laundering, Terrorist Financing and/or Fraud (Indicators are
listed in Appendix C) – the Client’s profile and all information collected to that point is forwarded to
Compliance personnel for further review and a potential filing of a Suspicious Activity Report
i. If the activity is in fact confirmed to be suspicious by the AML staff, the Client profile is placed on
hold and relevant Suspicious Activity Reports are filed
ii. The Client is not informed of these suspicions and subsequent actions
3. If the uploaded documents meet the requirements outlined in Step 1 – the CSR does one of
the following:
a. If only the verification of Identity was required – upon their verification the CSR may proceed in
opening the account
b. If the checking of proof of income/funds was necessary or there is a need for EDD, upon collecting all
the required documents the CSR forwards them to the Compliance Analyst (“Analyst”) for additional
checking:
i. The Analyst reviews the Client transaction history with WALLEX BANK, the provided documents
and explanations and evaluates if any further information is necessary
ii. If further information is required, the Analyst instructs the CSR to contact the Client and to obtain
the necessary information
iii. Once the Analyst is satisfied with the provided documentation, the Analyst will inform the CSR to
continue the on-boarding process
4. If the Client is unable or refuses to provide any of the requested documents, their account
cannot be opened.
a. If the Client’s refusal to provide documentation appears suspicious and or indicative of Money
Laundering, Terrorist Financing and/or Fraud – the Client’s profile and all information collected to
that point is forwarded to the Compliance Department for further review and a potential filing of a
Suspicious Activity Report
i. If the activity is in fact confirmed to be suspicious by the AML staff, relevant Suspicious Activity
Reports are filed
ii. The Client is not informed of these suspicions and subsequent actions
July 2021 | 82.4 Enhanced Due Diligence Where the risks of money laundering or terrorist financing are higher, the Client will be classified as high risk and WALLEX BANK will conduct Enhanced Client Due Diligence (“EDD”) measures, consistent with the risks identified. For EDD reviews, the AML Compliance team will complete a standard form which lists all the measures that will be taken. Here is a non-exhaustive list of enhanced measures that may be taken to mitigate the risk in cases of high-risk business relationships: • obtaining additional information on the Client (e.g. occupation, volume of assets, information available through public databases, Internet, etc.); • more frequent updating identity of the Client and any beneficial owner; • obtaining information on the source of funds or source of wealth of the Client; • obtaining information on the reasons for intended or conducted transactions; • obtaining the approval of senior management to enter into or maintain the business relationship; • increased and more frequent monitoring of transactions; • establishing more stringent thresholds for ascertaining identification; • gathering additional documents, data or information; or taking additional steps to verify the documents obtained; • establishing transaction limits customized to the nature, scale and complexity of theClient; • increasing internal controls of high-risk business relationships; • obtaining the approval of senior management at the transaction level for products and services that are new for that Client; • obtaining additional information on the intended nature of the business relationship; • obtaining regular credit reports; • structured online research of entities, including reviews of industry data, and the use of and documentation of results of an adverse keyword search string; • summaries of account activity. 2.4.1 Regulated Clients In case of clients being a licensed regulated entity themselves, an additional review will be performed during which their AML procedures would be evaluated. This review would include the Client filing out an additional questionnaire, providing their AML Policies, KYC Procedures, Audit results and similar. Only after the regulated Client’s AML program is fully vetted by the Compliance staff and approved by Senior Management would their account be opened. July 2021 | 9
2.4.2 Risk Based Approach In money laundering and terrorist financing, a risk-based approach covers the following: • the risk assessment of Client relationships and business activities; • the risk mitigation to implement controls to handle identified risks; • keeping Client identification, beneficial ownership and business relationship information up to date; and • the ongoing monitoring of business relationships and transactions. Existing regulatory obligations, such as for Client identification, are a minimum baseline requirement. Where enhanced due diligence is appropriate, a principle of the risk-based approach is to focu resources where they are most needed to manage risks within our tolerance level. 2.5 Sanctions Screening 2.5.1 Sanctions Screening by Third-party Providers Sanctions screening is included within the standard on-boarding procedure and is applied to all WALLEX BANK Clients. Individuals screened for potential sanctions matches within entities include: (a) Beneficial Owners (individuals holding 10% or more shares within the company), (b) Directors, (c) Authorized Signatories of the Company (if applicable). 2.5.2 Screening of Individual Transactions Individual transactions are also screened to ensure that funds are not being sent to individuals or entities on various sanctions/terrorist lists. The following sanctions databases are used: • Office of Foreign Assets Control – Specially Designated Nationals List • Her Majesty’s Treasury – Asset Freeze Target Lists • European Union – List of Persons, Groups and Entities Subject to EU Financial Sanctions • United Nations – Security Council Sanctions List The WALLEX BANK system uses these terrorist/sanctions databases to screen full and partial name matches. 2.5.3 Escalation If a potential name match is found, the transaction is automatically suspended and escalated – subject to direct review by a Compliance Analyst and if further action is needed then referred to the Money Laundering Reporting Officer (or “MLRO”) for further review. July 2021 | 10
If a Sanctioned individual is identified among WALLEX BANK Clients – their account is placed on hold and all funds received would be held – i.e. restrictions on circulation of funds would be implemented. 2.6 Politically Exposed Person Checks 2.6.1 PEP Screening by Third-party Providers WALLEX BANK Clients are checked against Politically Exposed Persons (“PEP”) databases through a third-party provider. These checks are performed during the Client on-boarding process and before the client is allowed to transact. Individuals screened for potential PEP matches within entities include: (a) Beneficial Owners (individuals holding 10% or more shares within the company), (b) Directors, (c) Authorized Signatories of the Company (if applicable). 2.6.2 Escalation If a potential name match is found, the account is suspended and escalated – subject to direct review by a Compliance Analyst and if further action is needed then referred to the MLRO for further review. If a national or international PEP is identified among WALLEX BANK Clients – their accounts are automatically placed on hold and the ECDD procedure would be initiated. PEPs (Clients or transactions related to PEPs) would only be allowed if their source and purpose of transacting is verified and reviewed/approved by the MLRO. All confirmed PEP interactions will be included in the MLRO report. July 2021 | 11
2.7 Further Details Collected from Clients
2.7.1 Definition of User Roles
Some key definitions are in place to identify the various levels of access that a Client / Client representative
can have to the WALLEX BANK payments platform and what information about them is collected:
Role Name in Sys- Role Description KYC Details Collected
tem
Con- ContactAdmin Management level employee (i.e. direc- Full KYC verification
tract tor, or authorized signatory). Will have as defined above for
the ability to assign other employees to the individual (Contact-
have access to other roles. Unique role,
only one ContractAdmin Admin)
per Client.
Con- PaymentsAdmin Role assigned by Contract – has full Each PaymentsAdmin
tact access to the payments platform and is is required to provide
able to transact on behalf of Client. Not Full Name, Date of
unique, Clients may have multiple Pay- Birth, Home Address,
mentsAdmins. Email
ReportsAdmin Role assigned by Contract – only has Each ReportsAdmin is
access to the reports/data on payments required to provide Full
processed, cannot process payments. Name and Email
Not unique, Clients may have multiple
ReportAdmins
July 2021 | 12Appendix A – Documents Required by Business Type Limited, Limited by Guarantee, LLC, UAB or equivalent • Business name and business registration number • Copy of the registration document, Memorandum and Articles of Association • Registry of Directors and Shareholders • Related companies and Corporate structure / Organisational chart. • Details of all Directors of the company: proof of ID, proof of Residential address • Details of all Ultimate Beneficial Owners/Shareholders* who own 10% or more of the company: proof of ID, proof of Residential address • Description business activities and link to company website • Bank statement, identify source of funds, expected flow of funds Partnership • Details of the managing partner/director of the company: proof of ID, proof of Residential address • The other partner’s proof of ID, proof of Residential address • For registered Partnerships - registration document • For unregistered Partnerships – partnership agreement between partners when the company was established • Description business activities and link to company website • Bank statement, identify source of funds, expected flow of funds Limited by Guarantee • Business name and business registration number • Copy of the registration document, Memorandum and Articles of Association • Registry of Directors and Shareholders • Related companies and Corporate structure / Organisational chart. • Details of all Directors of the company: proof of ID, proof of Residential address • Details of all Controllers/Guarantor Members: proof of ID, proof of Residential address • Description business activities and link to company website • Bank statement, identify source of funds, expected flow of funds July 2021 | 13
Appendix B - Acceptable Documents for Identity Verification
ID Documents
Provided document copies must be fully visible, unexpired and in color:
Passports – Issued in the UK or abroad
Driving License1 - UK, EEA/EU, or Swiss Driving License
National Identification Card2 - EU, EEA or Switzerland National Identification Cards
1 Driving Licenses issued in Latvia and Lithuania cannot be accepted as a primary identitydocument
2 “New Style”, plastic Identity Cards only – paper Identity Cards would not be accepted
Secondary ID Documents
Identification Documents
Valid (unexpired) government issued photo ID documents which contain the date of birth of the
individual (cannot be the same document that was used for Identification)
Financial Statements
Bank Statement / Other Letters Received from Banks / Building Society Statement / Credit Card
Statement (no older than 90 days)
Letters from Government Bodies
Letters from Home Office / Treasury / Revenue & Customs / etc. (no older than 6 months)
Bills
Gas Bill / Electricity Bill / Landline Telephone Bill (no older than 90 days; may be printed online in PDF)
Cable Bill (only if it includes a landline telephone; no older than 90 days; may be printed online in PDF)
Council Tax Bill / Water Bill (must relate to the current charging period)
TV Licenses Renewal Notification (no older than 6 months; must confirm the existence of a TV License)
UK mortgage statement (no older than 6 months and not printed from online)
July 2021 | 14Third Party Electronic Identity Verification
If the Client’s provided address and/or Date of Birth is verified by third party identity checking
providers (Electoral Roll, Credit Agencies, etc.) – this is considered a sufficient Secondary ID.
Source of Funds Verification
The following information is requested from Clients as Source of Funds / Income:
• Evidence of ongoing business
• Recent/relevant Bank Statements (showing accumulation of funds being sent)
• Recently filed Business Accounts
The following are additional guidelines for verifying the Client’s Source of Funds / Income:
Description of Source by Customer Information Required
Sale of Investments / Liquidation of Portfolio: Description of Shares / Units / De-
posits Relevant Documents
Total Amount Received
Relevant Bank State-
ments
Sale of Property: Sale Documents
Relevant Bank Statements
Loan Name of Lender
Total Amount Received
Loan Agreement
Relevant Bank Statements
Company Profits: Name and Address of Com-
pany Nature of Business
Relevant Bank Statements
A filled and signed Source of Funds Declaration form may also be requested.
July 2021 | 15Appendix C - Indicators of Suspicious Activity
Listed below are several anti-money laundering risk indicators or “red flags” that might be grounds for
suspicion. The list is not exhaustive and not conclusive, but can be used as a guide for inquiry and
follow-up, alongside other material.
A single indicator does not necessarily indicate reasonable grounds to suspect money laundering
or terrorist financing activity. However, if several indicators are present during one or a series of
transactions, then we will take a closer look at other factors before deciding whether the transaction
must be reported.
Becoming aware of certain indicators could trigger reasonable grounds to suspect that one or more
transactions from the past (that had not previously seemed suspicious) were related to money laundering
or terrorist financing.
Criteria of Suspicious Transactions
The criteria for recognizing money laundering and suspicious operations or transactions related to the
behavior of the Client are as follows:
(A) at the time of entering into a business relationship, the Client or their representative is reluctant to
provide information necessary to identify the Client, conceals the identity of the beneficial owner or
avoids providing the information necessary to identify beneficial owners,provides documents which
raise doubts as to their genuineness, authenticityetc.;
(B) it is difficult to obtain information or documents necessary for the monitoring of the business
relationship from the Client: it is difficult to contact the Client, their place of residence as well as other
contact details often change; the phone number provided by the Client or his representative does
not answer or it is disconnected; the Client or their representative fail to respond when addressed
via e-mail;
(C) the Client is unable to answer questions regarding their ongoing/planned financial activity and the
nature thereof; is excessively nervous;
(D) the Client expresses a wish to end the business relationship when asked to provide the information
necessary for monitoring of their business relationship;
(E) at the request of WALLEX BANK, the Client refuses to provide information on the origin of the
funds deposited (or an attempted deposit) to their account and/or to support it by relevant
documents;
(F) a single individual is a director or the beneficial owner of multiple legal entities (except for big
groups of companies);
(G) several companies have been registered at the same address.
July 2021 | 16The criteria for recognizing money laundering and suspicious monetary operations or transactions
related monetary operations or transactions carried out by the Client or his representative are as follows:
(A) the monetary operations or transactions of the Client are not in line with the activities indicated in
their incorporation documents or not in line with what was discussed at on- boarding with WALLEX
BANK;
(B) the nature of the monetary operations or transactions conducted by the Client raise asuspicion
of efforts to avoid various identification or verification steps set forth by WALLEX BANK;
(C) the Client’s account is a pass-through account: having credited the funds to the account, they are
transferred to another account shortly afterwards, and other operations barely take place on the
account;
(D) During the enhanced review of the Client’s source of funds - the flow of goods and settlements made
for them do not match: companies or individuals unrelated to the transaction appear to pay for the
goods;
(E) the Client carries out a transaction (transactions) and make a payment (payments) which is (are)
beyond the Client’s possibilities known to WALLEX BANK or requests to make an advance
payment exceeding the regular amount or other type of payment;
(F) the Client requests that funds belonging to them are paid to persons who are clearly unrelated to the
Client’s normal activity;
(G) the whole payment or part of a payment is made on the Client’s behalf by persons who are clearly
unrelated to the Client or their normal activity;
(H) the Client is continuously engaged in transactions for property where the value is clearly not in line
with the average market value;
(I) the Client carries out monetary operations or conducts transactions without any apparent
economic justification;
(J) the Client carries out monetary operations or conducts transactions when it is difficult or
impossible to identify the beneficial owner;
(K) the Client, the Client’s representative (where the monetary operation or transaction is carried out
through the representative) or the person who is the beneficiary of the monetary operation or
transaction is subject to financial sanctions in the framework of the Law on the Implementation of
Economic Sanctions of the UK and other International Sanctions;
(L) the number of transfers from different accounts to the Client’s account increases without a clear
basis;
(M) the number of transfers from the Client’s account to several different unrelated accounts increases
without a clear basis;
(N) Non-Profit Organization’s (the “NPO”) monetary operations or transactions are not in line with the
types of activity specified in its incorporation documents;
(O) only crediting or cashing operations are performed in the NPO’s account;
(P) purpose of a payment order to/from the NPO does not match the activity conducted by a beneficiary
or a donor;
July 2021 | 17(Q) large payment orders are made to the accounts of founders of the NPO;
(R) the NPO’s account is replenished by small amounts more often without an apparentbasis.
The criteria for recognizing money laundering and suspicious monetary operations or transactions
related to the geographical aspect of the monetary operations or transactions carried out are as follows:
(A) the Client does not perform monetary transfers from/to its account opened in a European Union
Member State, in which it has been registered, or the amount of funds transferred to the Client’s
account opened in the state of registration thereof constitutes a negligible part of all the monetary
operations over time or the funds kept in it;
(B) monetary operations or transactions are carried out with natural and legal persons located in
high-risk regions (e.g. Sanctioned countries; countries which are not members of the FATF or
countries that have been highlighted by FATF as uncooperative; or with countries where terrorist
organizations are very active) whereas the economic justification of the monetary operations or
transactions is unclear;
(C) the Client constantly performs monetary operations or conducts transactions with legal entities or
other organizations, registered in a risk country, when there is no clear economic justification of
such activity;
(D) there is data suggesting that a person donating funds to the NPO may be fictitious or represent a
person originated from a risk country and/or the donated funds do not match the person’s financial
status;
(E) a NPO, operating in a risk country, or a person who provides support to risk countries carries out
payment orders or makes money remittances;
(F) a donation to a NPO is accompanied by a condition to transfer funds to a person associated with
a risk country.
Seeking to recognize the likely features of terrorist financing, the following criteria sh is associated with
the risk country and/or the natural person is associated with a legal entity registered in the risk country;
(A) monetary operations are carried out by legal entities established in a risk country or established
legal entities which carry out monetary operations through other legal entities established in those
areas or countries;
(B) there is information leading to assumption that a Client does not act for his own benefit and/or
may represent a person associated with a risk country, or a person is reluctant to reveal the true
beneficial owners;
(C) a Client is unable to explain why they require WALLEX BANK’s services, what kind of activity they
intend to conduct or are unable to provide other necessary information;
(D) a Client requests that correspondence related to the financial operations are sent to an address
located in a risk country;
(E) a Client receives or makes payment orders, cash remittances to/from the account of a person who
is associated with a risk country;
July 2021 | 18(F) During the enhanced review of the Client’s source of funds a one-time replenishment of the Client’s
bank account by an unusually large amount is identified, which is extraordinary to theClient’s activity
and is cashed out or otherwise transferred immediately;
(G) access to the Client account is granted to several authorized persons unrelated to the Client by
family or partnership relations and/or if those persons are associated with a risk country;
(H) payment orders for services provided by a Client registered in a risk country which are not related
with their activity, and/or withdrawing funds shortly after the payment order;
(I) the purpose specified in the payment order to a risk country is for example, as follows: dole,
donation, sadaqa, sadaga, zakat, zakaat, ramadaan, ei al‘adha, iftar, haj, sponsor aid;
(J) during a transaction, at least one of the parties thereto is reluctant to provide information necessary
for identification of the Client;
(K) a transaction is settled in a currency of a risk country;
(L) a Client, associated with a risk country, makes a payment order for real estate;
(M) a Client, associated with a risk country, intends to receive assistance from persons providing legal
services in order to settle a transaction seeking to conceal the origin of the funds.
In assessment of the alleged connection of the property with the terrorist financing, the following
aspects must be taken into consideration:
(A) funds shall mean any type of tangible or intangible, movable or immovable property irrespective of
the way of acquisition thereof and legal documents or instruments of any form, including electronic
or digital, evidencing title to or an interest in such property, including, however not limited to, bank
credits, traveller’s cheques, bank cheques, postal money orders, shares, securities, bonds, notes,
letters of credit;
(B) the property (funds) may be of either legal or illegal origin, as long as it is collected, accumulated
or provided for purposes of the terrorist financing;
(C) both direct and indirect collection, accumulation or provision of the property (funds) shall be treated
as the terrorist financing activity;
(D) collection, accumulation or provision of the property (funds) shall be regarded as intentional
deliberate activity seeking or knowing that this property (funds) or only a part thereof will be aimed
at the terrorist financing, i.e. mere perception of a person that the property might be aimed at the
terrorist financing is sufficient, even if he does not have an intentional pursuit thereof;
(E) terrorist financing includes collection, accumulation, provision of the property (funds) for committing
particular terrorist crimes (e.g. to perform a terrorist attack), training of terrorists(e.g. inciting crimes of
terrorism, recruiting, training terrorists, creating terrorist groups etc.), and also supporting individual
or several terrorists or terrorist groups even if this property will not be aimed at committing particular
terrorist crimes (e.g. for the rent or premises, material support, healthcare, relief etc.). It shall not be
necessary to establish a connection of the collected, accumulated, provided property (funds) with
a particular terrorist crime.
July 2021 | 19You can also read
