CROSSCHANGE INTERNATIONAL OÜ
DECEMBER 15, 2020
Crosschange International OÜ (hereinafter the “Company”) appreciates the trust placed by the Client in the Company, and is therefore committed to protect its Users as well as comply with all applicable laws.
The Company is required to comply with the provisions of the current legislation on combating the legalization of funds obtained by criminal means and terrorist financing – set forth in the Anti-Money Laundering and Terrorist Financing Prevention Act (hereinafter referred to as the “AML Act”).
Crosschange International OÜ is based in Estonia and therefore is supervised in matters of prevention of money laundering by the Estonian Financial Intelligence Unit (FIU), an independent structural unit of the Estonian Police and Border Guard Board (PBGB).
Under the AML Act, all financial institutions are required to collect, verify and store data identifying the account holder to help public authorities throughout the world to combat money laundering and terrorist financing. In accordance with the applicable domestic laws of Estonia, as well as international legislation, the Company has developed and uses its internal policies namely “Anti Money Laundering & Know Your Customer policy” (hereinafter referred to as –“Policy”), aimed at countering the financing of terrorism and legalization of funds coming from crime.
The AML & Terrorist Prevention regulations are based on the Fifth Directive on the prevention of money laundering.
On June 19, 2018, the Fifth Directive on the prevention of money laundering (Directive (EU) 2018/843), which amended the Fourth Directive, was published in the Official Journal of the European Union, establishing January 10, 2020 as the limit date for the Member States to transpose that Directive.
Specifically, the appearance of the Fifth Directive has resulted in the inclusion as “Obligated subjects” of entities that provide virtual currency services, that is exchange services (between FIAT currency and virtual currency) and wallet custody services; both activities carried out by Crosschange International OÜ.
Illicit financial flows can damage the integrity, stability and reputation of the Company. The purpose of this Policy is to prevent the Company from being used, intentionally or unintentionally, for money laundering activities or terrorist financing activities. KYC and AML procedures shall also enable the Company to know and understand its Users and its financial dealings better which, in turn, will help it to manage the risks prudently. The purpose of the Policy is, among others, to ensure that the customers participating in financial transactions using the website or platform of the Company will pass the necessary verification procedures and provide the required lists of identification data. The Company takes responsibility to closely monitor suspicious activity and transactions and promptly report of such activities to the appropriate authorities (Estonian and European Union Financial Intelligence Units).
Thus, this Policy has been set forth by the Company for the following purposes:
- To prevent the use of the Company’s services for money laundering activities, financing of terrorism and/or legalizing of proceeds from crime;
- To prevent and limit the anonymity related to virtual currencies and wallet provider’s Users accounts.
- To enable the Company to know and understand its Users and their financial dealings better which, in turn, would help the Company to manage risks prudently allowing it to face the public records in a more efficient way.
- To put in place appropriate controls for detection and reporting of suspicious activities in accordance with applicable laws/procedures laid down;
- To comply with applicable laws and regulatory guidelines as well as improve the cooperation with money laundering prevention supervisors and the European Central Bank.
THIS POLICY COVERS THE FOLLOWING MATTERS
1. IDENTITY VERIFICATION
The Company’s verification procedure, has been created in compliance with international standards and requirements, and works as follows:
The Company’s identity verification procedure requires the User to provide the Company or its contractors with reliable, independent source documents, data or information (e.g., national ID, international passport, bank statement, utility bill, etc.). For this purpose, the Company reserves the right to collect and store personal data and all information needed related to the Users of the services.
To confirm the authenticity of the documents and information provided by Users, the Company shall take all the necessary steps. In this sense, all legal and accessible methods for double-checking identification information will be used.
The Company reserves the right to verify the User’s identity in an on-going basis, especially when the identification information has been changed or the Client’s activity seems suspicious (unusual for the particular User).
Once the User’s identity has been verified, the Company may remove itself from potential legal liability associated with subsequent actions of Users.
2. COMPLIANCE OFFICER
The Compliance Officer is the person, duly authorized by the Company, whose duty is to ensure the effective implementation and enforcement of this Policy.
It is the Compliance Officer’s responsibility to supervise the actions and measures adopted by the Company in order to ensure anti-money laundering and counter-terrorist financing. The activity of the Compliance officer includes, but is not limited to:
Collecting Users identification information.
Establishing and updating internal policies and procedures for the completion, revision, submission and retention of all reports and records required under the applicable laws and regulations.
Monitoring transactions and investigating any significant deviations from normal activity.
Implementing records management system for appropriate storage and retrieval of documents, files, forms and logs.
Updating risk assessment regularly.
Providing law enforcement with information as required under the applicable laws and regulations.
The Compliance Officer is entitled to interact with law enforcement involved in prevention of money laundering, terrorist financing and other illegal activity.
The Company has the right to hire independent, duly authorized contractors for the purpose of compliance with this Policy.
3. RISK ASSESSMENT
The Company, in line with the international legislation, has adopted a risk-based approach to combat money laundering and terrorist financing in all its possible or potential manifestations. By adopting a risk-based approach, the Company is able to ensure that measures to prevent or mitigate money laundering and terrorist financing are commensurate with the identified risks.
This principle leads to using the resources in accordance with priorities, that is giving the highest attention where there are greatest risks.
As regards the risk assessment, referred to above, the Company shall:
- use it to improve its AML/KYC regime, in particular by identifying any areas where obliged subjects are to apply enhanced measures and, where appropriate, specifying the measures to be taken;
- use it to identify, where appropriate, sectors or areas of lower or greater risk of money laundering and terrorist financing;
- use it to assist in the allocation and prioritization of resources to combat money laundering and terrorist financing;
- use it to make appropriate information available promptly to obliged subjects to facilitate the carrying out of their own money laundering and terrorist financing risk assessments.
As part of the User risk assessment, the following will act as Money Laundering Warning Signs based on guidance provided by the Money Laundering and Terrorist Financing Prevention Act and Financial Action Task Force (FATF) – an international body set up to combat money laundering:
- User indicating that the funds are coming from one source but last minute the source changes;
- Evasiveness or reluctancy to provide information;
- Incompletion or inconsistent information;
- Unusual virtual currency transfers or transactions;
- When cryptocurrency is coming from the list of “high-risk and non-co-operative jurisdictions” according to FATF;
- No public information available about the User.
In case of making a transaction with a client of a private limited company or establishing a business relationship, if the value of the client’s transactions in a calendar month exceeds 1000 euro, regardless of whether the financial liability is fulfilled in a single payment or in the amount of several interrelated payments in a period of up to one month or an equivalent amount in another currency, the degree of risk of money laundering and terrorist financing must be assessed and, accordingly, the appropriate diligence measures will be applied.
4. USER’S OBLIGATIONS AND GUARANTEES
The User is obliged under this Policy:
- To respect and obey any requirements of the law, including internal policies, directed to fight against illegal activities, financial frauds, laundering and legalization of the money received in an illegal way;
- To comply with all applicable laws on counteraction of legalization of proceeds from crime, including but not limited to the AML/CTF Act, as well as comply with all related rules and regulations;
- To exclude direct or indirect involvement of illegal financial activities and/or any other illegal operations by using the Company’s website, platform or Services;
- To refrain from using the products or tokens for any illegal or fraudulent action, or for any illegal or fraudulent Operations (including money laundering) according to the Applicable law;
- To immediately provide any information that the Company deems necessary for compliance with applicable laws and regulatory requirements in respect to combating the legalization of funds obtained by illegal means;
- To represent and warrant the Company that the funds, used in its relationship with it in the past, present and future, have been obtained from legitimate sources and have no relation to the legalization of income obtained by illegal means or to any other illegal activity prohibited by applicable law or regulations of any international organizations;
- To guarantee the Company that profits earned from trading and/or any kind of investment operations will not be used to finance any illegal activity.
The User guarantees the legal origin, legal ownership and availability of the actual right to use the cryptocurrency used or transferred by the User.
The Company reserves the right to investigate certain Users who have been determined to be risky, suspicious or resident in geographical areas of higher risk.
In case of suspicious or fraudulent fund replenishments, including any returns or cancellations of pre-orders or provision of incomplete or incorrect information, the Company also reserves the right to cancel any existing pre-order, to block the User’s account, to cancel results of any financial operations performed by the User and to investigate operations of doubtful nature.
Refusal by the Company to carry out suspicious operations will not lead to the Company being responsible before the User and / or other third parties. Non-execution will not result in any liabilities in relation to the User.
The Company at its sole discretion may terminate the User’s account or refuse to carry out any pre-orders or applications if the Company or its contractors discover non-compliance of this Policy or other internal rules.
To ensure that the information that the Company holds of its customers is always accurate and up to date, the Company shall, upon its sole discretion, determine the periodicity at which each User shall be, upon request, obliged to provide their KYC information to continue using the Company’s products and services.
7. Institutional declaration on money laundering
Crosschange International OÜ Principles on the Prevention of Money Laundering and Terrorism Financing
Crosschange International OÜ, its affiliates and trusted businesses are committed to follow all national and international legal initiatives and legislations to prevent money laundering, terrorist financing and other financial crimes.
Crosschange International OÜ has its headquarters in Estonia and is supervised in matters of prevention of money laundering by the Estonian Financial Intelligence Unit (FIU), an independent structural unit of the Estonian Police and Border Guard Board.
Estonia is a member of the European Union and the Financial Action Task Force (FATF-GAFI). In Estonia, money laundering is considered a crime.
The company has designed and implemented a money laundering prevention program based on Estonian regulations and international standards.
The Crosschange International OÜ prevention program consists of the following:
Elaboration of policies for the prevention of money laundering and terrorist financing.
Development of procedures for the prevention of money laundering and the financing of terrorism.
Creation of an adequate structure for the prevention of money laundering.
Implementation of customer and beneficial owner identification standards prior to establishing business relationships; implementation of KYC (Know Your Customer) customer knowledge standards and the purpose of the business relationship.
Application of supervision procedures and continuous monitoring of the Client.
Refraining from operating with entities that do not have a real physical address.
Abstention of operating with Offshore Banks.
Implementation of procedures to know at all times if any of the clients is a person of public responsibility who performs or has performed important public functions in other Member States of the European Union or in third countries, as well as to identify their closest relatives and individuals recognized as close friends. (PEP / PRP).
Application of procedures that allow, as far as the Company can reach, the abstention from carrying out operations on which it is suspected that it could be related to money laundering or terrorist financing.
Use of operation control systems focused on the detection of money laundering and terrorist financing. In particular, alerts on cash transactions and transfers, and follow-up alerts for clients with risk above the average or deviation from the profile established for each client.
Regular check of customer files against lists of suspicious persons issued by recognized bodies.
Special examinations of those operations that because of their nature could be related to money laundering or terrorist financing, leaving in writing the actions taken and the course given to them.
Submission of the policies and procedures to a review by an Internal Audit, as well as submission to an External Expert who must have previously communicated it to the Financial Intelligence Unit.
Record keeping of documentation for the period of time established by the applicable laws in order to make it available when necessary to the Financial Intelligence Unit for the Prevention of Money Laundering.
Reporting to competent authorities of those operations with indications of being related to money laundering or terrorist financing.