CB-TEK VENTURES ANTI MONEY-LAUNDERING (AML) POLICY
It is the policy of CB-TEK VENTURES, (hereinafter “CB-TEK”) to prohibit and actively pursue the prevention of money laundering and any activity that facilitates money laundering or the funding of terrorist or criminal activities. CB-TEK is committed to AML compliance in accordance with applicable laws of jurisdictions where CB-TEK offers corporate and legal services. CB-TEK requires its officers, employees and affiliates to adhere to these standards in preventing the use of its products and services for money laundering purposes.
For the purposes of the Policy, money laundering is generally defined as engaging in acts designed to conceal or disguise the true origins of criminally derived proceeds so that the unlawful proceeds appear to have been derived from legitimate origins or constitute legitimate assets.
Generally, money laundering occurs in three stages. Cash first enters the financial system at the “placement” stage, where the cash generated from criminal activities is converted into monetary instruments, such as money orders or traveler’s checks, or deposited into accounts at financial institutions. At the “layering” stage, the funds are transferred or moved into other accounts or other financial institutions to further separate the money from its criminal origin. At the “integration” stage, the funds are reintroduced into the economy and used to purchase legitimate assets or to fund other criminal activities or legitimate businesses. Terrorist financing may not involve the proceeds of criminal conduct, but rather an attempt to conceal the origin or intended use of the funds, which will later be used for criminal purposes.
Each employee of CB-TEK, whose duties are associated with the provision of products and services of CB-TEK and who directly or indirectly deals with the clientele of CB-TEK, is expected to know the requirements of the applicable laws and regulations which affect his or her job responsibilities, and it shall be the affirmative duty of such employee to carry out these responsibilities at all times in a manner that complies with the requirements of the relevant laws and regulations.
To ensure that this general policy is carried out, management of CB-TEK has established and maintains an ongoing program for the purpose of assuring compliance with the relevant laws and regulations and the prevention of money laundering. This program seeks to coordinate the specific regulatory requirements throughout the group within a consolidated framework in order to effectively manage the group’s risk of exposure to money laundering and terrorist financing across all business units, functions, and legal entities.
Each of the branches of CB-TEK is required to comply with all aspects of this policy as well as their own AML policies which specifically consider the local AML laws and requirements to which they are subject. Failure by the branch and its affiliates to comply with the all applicable local AML laws and regulations could result in severe regulatory sanctions, possible fines and criminal penalties and damage to the CB-TEK’s business reputation.
An assessment of the risk of exposure to money laundering issues across all customer relationships shall be completed using the CB-TEK standardized risk rating model. The risk rating model shall be approved by management on an annual basis.
There are signs of suspicious ctivity that suggest money laundering. These are commonly referred to as “red flags.” If a red flag is detected, additional due diligence will be performed before accepting client’s requests or providing services.
Examples of red flags are:
The customer exhibits unusual concern regarding the AML policies, particularly with respect to his or her identity, type of business and assets, or is reluctant or refuses to reveal any information concerning business activities, or furnishes unusual or suspect identification or business documents.
The customer wishes to engage in transactions that lack business sense or apparent investment strategy, or are inconsistent with the customer’s stated business strategy.
The information provided by the customer that identifies a legitimate source for funds is false, misleading, or substantially incorrect.
Upon request, the customer refuses to identify or fails to indicate any legitimate source for his or her funds and other assets.
The customer (or a person publicly associated with the customer) has a questionable background or is the subject of news reports indicating possible criminal, civil, or regulatory violations.
The customer exhibits a lack of concern regarding risks, commissions, or other transaction costs.
The customer appears to be acting as an agent for an undisclosed principal, but declines or is reluctant, without legitimate commercial reasons, to provide information or is otherwise evasive regarding that person or entity.
The customer has difficulty describing the nature of his or her business or lacks general knowledge of his or her industry.
The customer attempts to make frequent or large deposits of currency, insists on dealing only in cash equivalents.
For no apparent reason, the customer has multiple accounts under a single name or multiple names, with a large number of inter-account or third-party transfers.
The customer is from, or has accounts in, a country identified as a non-cooperative country or territory by the Financial Action Task Force.
The customer’s account has unexplained or sudden extensive wire activity, especially in accounts that had little or no previous activity.
The customer’s account shows numerous currency or cashiers check transactions aggregating to significant sums.
The customer’s account has a large number of wire transfers to unrelated third parties inconsistent with the customer’s legitimate business purpose.
The customer’s account has wire transfers that have no apparent business purpose to or from a country identified as money laundering risk or a bank secrecy haven.
The customer’s account indicates large or frequent wire transfers, immediately withdrawn by check or debit card without any apparent business purpose.
The customer makes a funds deposit followed by an immediate request that the money be wired out or transferred to a third party, or to another firm, without any apparent business purpose.
The customer makes a funds deposit for the purpose of purchasing a long-term investment followed shortly thereafter by a request to liquidate the position and transfer of the proceeds out of the account.
The customer engages in excessive journal entries between unrelated accounts without any apparent business purpose.
The customer requests that a transaction be processed in such a manner to avoid the firm’s normal documentation requirements.
The customer, for no apparent reason or in conjunction with other red flags, engages in transactions involving certain types of securities, such as penny stocks, bearer bonds, which although legitimate, have been used in connection with fraudulent schemes and money laundering activity. (Such transactions may warrant further due diligence to ensure the legitimacy of the customer’s activity.)
CB-TEK will document and maintain written customer identification procedures (“CIP”) that will enable to form a reasonable belief that CB-TEK knows the true identity of each customer. If CB-TEK is not able to verify the identity of a customer within a reasonable period of time after services or account opening request, that services shall be suspended and account will be closed. Such an account and services will be subject to increased due diligence until such time as the customer’s identity has been verified or the account has been closed and services suspended.
CIP for Natural Persons
For natural persons the following information should be obtained, where applicable:
Legal name and any other names used (such as maiden name).
Correct permanent address (the full address should be obtained. a Post Office box number is not sufficient).
Telephone number, fax number, and e-mail address.
Date and place of birth.
Occupation, public position held and/or name of employer.
An official personal identification number or other unique identifier contained in an unexpired official document (e.g. – passport, identification card, residence permit, social security records, driving license) that bears a photograph of the customer.
Source of wealth (where appropriate).
CB-TEK shall verify this information by at least one of the following methods:
Confirming the date of birth from an official document (e.g. birth certificate, passport, identity card, social security records).
Confirming the permanent address (e.g. utility bill, tax assessment, bank statement, a letter from a public authority).
Contacting the customer by telephone, by letter or by e-mail to confirm the information supplied after an account has been opened or other services provided (e.g. a disconnected phone, returned mail, or incorrect e-mail address should warrant further investigation).
Confirming the validity of the official documentation provided through certification by an authorized person (e.g. embassy official, notary public).
All identification documentation and services records shall be kept for the minimum period of time required by local law.
Due Diligense Documentation
In verifying the personal information supplied by the customer, the financial services business will do so by holding the following documentation:
A certified copy of an official personal identification number or other unique identifier contained in an unexpired official document that bears a photograph of the client, for example:
National Identification Card
National Residence Permit
Proof Of Residence
An original or certified copy of a document carrying the name and residential address of the individual in mention, which is no more than three (3) months old.
An original or certified copy of a document carrying the parental home address as the principal residence with an accompanying letter/e-mail from the parent and certified copy of parent’s identification.
Bank /credit card statement
Letter of employment (on official company letterhead, stating employment period and residential address)
Lawyer’s confirmation of property purchase, or legal document recognizing title to property.
A personal visit to the residential address (by Director or Manager)
Copy of lease agreement
All documentation received must be either in original form or certified copies.
Documentation received via e-mail must be clear scanned certified copies of the original documents.
Documentation submitted at an agent’s offices must be either the original documentation submitted in person by the account holder or the original certified copies.
Identification numbers and proof of residence documentation showing residential address are used to verify the personal details submitted in the application form.
Proof of Residence
Documents provided as proof of residence are cross-referenced against the personal information provided in the registration form. Utility bills provided as proof of residence that are older than three months are not accepted.
Employment letters provided as proof of residence should be on an official company letterhead showing company address and contact details and be signed and dated by a company manager/director.
Detecting a suspicious transaction is based on the following transaction situations:
Out of the ordinary transaction based on the clients’ transaction history
If the beneficiary or originating account name is found to be associated to any form of illegal financing or financial fraud during security checks
If the value of transfer does not logically match with the invoice submitted or the purpose of the transfer
If the transfer is destined for a black listed country (NCCT)
If the transfer is allowed for urgency and the client does not submit the required documentation in the requested time frame
If it is felt that a transaction is deemed suspicious, it is required that the processing of the transaction be discontinued and reported.
In the instance of a transaction being processed on behalf of or with a client, it is necessary for the transaction to be recorded. This is to ensure that in every case sufficient information is recorded to enable the reconstruction of individual transactions so as to provide, if necessary, evidence for prosecution of criminal activity.