Anti-Money Laundering Policy

Anti-Money Laundering Policy (Canada)

Click has developed an anti-money laundering policy that meets legislative requirements and reflects managements’ principles on managing money laundering and terrorist financing risks.

Click is planning to register with the Financial Transactions and Reports Analysis Centre of Canada (“FINTRAC”) as a Money Service Business (“MSB”) and will cooperate fully with FINTRAC and other law enforcement agency requests.

  1. The Proceeds of Crime (Money Laundering) and Terrorist Financing Deterrence Act(“PCMLTFA”)

In accordance with the prescribed legislative requirements, our Company has certain record keeping, identification and reporting requirements. Our Company has chosen to implement and maintain a compliance regime which includes:

  • The appointment of a chief anti-money laundering officer;
  • The development and application of compliance policies and procedures.
  • Executing Know Your Customer (“KYC”) procedures on all customers;
  • An assessment of our risks as it relates to money laundering and terrorist financing;
  • Monitor transactions for potentially suspicious and attempted suspicious activities for purposes of filing Suspicious Transaction Reports (a “STR”);
  • Maintaining and providing written, on-going compliance training for our employees; and
  • A regular review of our compliance regime to test its effectiveness related to money laundering and terrorist financing every 2 years.
  1. Appointment of a Chief Anti-Money Laundering Officer

Under the PCMLTFA requirements, Click has a chief anti-money laundering officer (“CAMLO”), who is responsible for the implementation of our compliance regime. The CAMLO has the authority and the resources to ensure the on-going compliance of our organization as it relates to money laundering and terrorist financing identification and prevention.

  1. Ongoing Monitoring of Business Relationships

Business relationships are defined as clients who conduct two or more financial transactions within a five year period in which the Company has to:

  • Ascertain the identity of the individual; or
  • Confirm the existence of a corporation or other entity.

Click considers all accounts/wallets to be business relationships and accordingly, follows the regulatory requirements of:

  • Risk rating all our business relationships;
  • Conducting ongoing monitoring of the business relationship at a frequency commensurate to our clients’ risk; and
  • Keeping a record of the measures that we have taken to monitor the relationship and the information we obtained as a result.

If necessary, we may require our clients to provide additional documentation or information to confirm source of funds or the purpose of the transaction. We may also amend their risk rating if the need arises.

Click’s compliance staff will review any transactions that trigger an alert and determine if the transactions are within the clients’ stated activity before being released or completed. In some cases, Click will require additional information such as the client’s source of income, proof of employment, nature of the client’s business, as well as review of client transaction history.

  1. Record Keeping

As a registered MSB with FINTRAC, we are required to keep certain types of records depending on the transaction type. We must keep a record of any suspicious transaction reports submitted to FINTRAC. There is no threshold (that is, no dollar amount) for a suspicious transaction. When we have to send a suspicious transaction report to FINTRAC, we must take reasonable measures, before the transaction is reported, to ascertain the identity of the individual who conducted or attempted to conduct the transaction.

  1. KYC Processes

5.1 When and how do we have to identify clients?

In general, prior to Click performing a transaction for a client, we must identify that client. Click has a policy of requiring all customers to be “verified” prior to being able to undertake any form of transactions through our trading platform. Accounts are only made available to Canadian residents with Canadian bank accounts in order to mitigate against the risk of money laundering and terrorist financing activities.

Customer may be verified by way of:

5.2 Instant Verification (Single Process Method)

We ascertain the identity of a client by referring to a Canadian credit file that has been established with Equifax. To be verified, the credit file details must match the name, date of birth and address provided by an individual client. If any of the information does not match, the individual will need to use another method to ascertain client identity.

5.3 Manual Verification (Dual process method)

This method involves referring to information from reliable and independent sources which can be submitted by the individual in original paper form or in electronic form. As part of the account sign up process, our clients are asked to upload to our site the original electronic or paper documents they received or downloaded. All documents must appear to be valid and unaltered in order to be acceptable.  If any information has been redacted, it is not acceptable.

5.4 How to Identity Corporations and Other Entities

For corporate clients, we are required to confirm the existence of the entity, and the entity’s beneficial ownership.

Corporations

We confirm the existence of a corporation as well as the corporation’s name and address, by referring to the following documents:

  • Power to bind the corporation – Articles of incorporation (with Full names of all Directors and at least 3 Authorized Signatories (if any))
  • Proof of existence:
    • Certificate of Corporate Status (if incorporated within the previous 12 months);
    • Corporation Profile Report;
    • A record that has to be filed annually under provincial securities legislation; corporation’s published annual report signed by an independent audit firm; or
    • a letter or a notice of assessment from a municipal, provincial, territorial or federal government.
  • Proof of address (utility bill, bank statement or any government record) – if not in the first or second bullet above
  • Trade name registration, if applicable
  • Beneficiary ownership attestation (BOA) form and ID on the ultimate beneficiary. Also, names and addresses of the individuals who are the beneficial owners, for example directors or shareholders, i.e. any actual person who owns or controls, directly or indirectly, 25% or more of the corporation’s shares, if nobody controls – information confirming that there is no actual person.
  • Signed Corporate Resolution
  • Completed the Click signup form (including the nature of business, source of funds and estimated monthly volume parts)

Entities other than corporations

We confirm the existence of an entity other than a corporation by referring to a partnership agreement, articles of association or any other similar record that confirms the entity’s existence.

In confirming an entity’s existence, we must be able to refer to a paper or electronic record and retain a copy of it. Verbal confirmation is not sufficient. Electronic records must be from a public source and we must record the type and source and corporation’s registration number.

Not-for-profit organization

If the entity is a not-for-profit organization, we also have to do the following:

  • Determine whether or not the entity is a registered charity for income tax purposes
  • If that entity is not a registered charity, determine whether or not it solicits charitable financial donations from the public

Beneficial Ownership Records

In addition to confirming the existence of a corporation or other entity, we also must determine and confirm the accuracy of the entity’s beneficial ownership through the following:

  • If the entity is a corporation:
    • The name and occupation of all directors of the corporation; and
    • The name, address and occupation of all individuals who directly or indirectly own or control 25% or more of the shares of the corporation.
  • If the entity is other than a corporation:
    • The name, address and occupation of all individuals who directly or indirectly own or control 25% or more of the entity.

5.5 Keeping Client Identification Information Updated

We must keep our client information up to date. For clients that have a customer file with us, we will, at a minimum, update the client identification at least every two years. This is to be done by reviewing original identity documents and recording the identification details for our files as appropriate.

  1. Record Maintenance

We are required to maintain an effective recordkeeping system to enable FINTRAC to have access to the records in a timely fashion. Our records have to be kept in such a way that they can be provided to FINTRAC within 30 days of a request to examine them.

  1. Suspicious Transaction Reports

The Company must report any transactions or attempted transaction that we suspect relates to money laundering or terrorist activity financing regardless of the amount. There is no monetary threshold for submitting a Suspicious Transaction Report.

The CAMLO has the authority to file STRs with FINTRAC and is required to maintain a log of all reports filed.

Tax evasion is also considered a predicate offense for money laundering; accordingly, if we suspect transactions are being undertaken to avoid or evade paying income taxes we need to report the transactions as suspicious to FINTRAC.

  1. Terrorist Property Reporting Requirements and Sanctions

There are two situations where we must send a terrorist property report to FINTRAC immediately:

  • Knowing that property is owned or controlled by or on behalf of a terrorist or terrorist group; and
  • Believing that a property is owned or controlled by or on behalf of a listed person.
  1. Ongoing Monitoring of Business Relationships

If in the course of reviewing and monitoring, we identify unexplainable, unusual activity, patterns or have any questions, we will work to obtain further information so that these questions are satisfactorily answered and/or we will report the activity internally to the CAMLO who is required to maintain a record/log of all internally reported and perform a review to determine if an STR is to be filed with FINTRAC. If we have not reached a clear understanding of the sources and movement of funds, it may result in the account being permanently closed. This will be followed by terminating the relationship with the de-marketed account owner and placing them on the de-market list without the right of re-opening a new account unless authorized by the senior management and the CAMLO.

This document was last updated on March 1, 2018

Anti-Money Laundering Policy (Europe)

Click has developed an anti-money laundering policy that meets legislative requirements and reflects management’s principles on managing money laundering and terrorist financing risks. Click cooperates fully with the Financial Market Authority (FMA) and the Financial Intelligence Unit (FIU) of Liechtenstein, as well as any law enforcement agency requests.

1.  Law of 11 December 2008 on Professional Due Diligence for the Prevention of Money Laundering, Organised Crime and Financing of Terrorism (Due Diligence Act; SPG)

In accordance with the prescribed legislative requirements, our Company has certain record keeping, identification and reporting requirements. Our Company has chosen to implement and maintain a compliance regime which includes:

  • The appointment of a chief anti-money laundering officer, who acts as the contact person to the supervisory authority and the Liechtenstein Financial Intelligence Unit (FIU);
  • Executing Know Your Customer (“KYC”) procedures on all customers;
  • The development and application of compliance policies and procedures;
  • An assessment of our risks as it relates to money laundering and terrorist financing;
  • Filing Suspicious Transaction Reports (“STRs”) and Terrorist Financing Reports, where warranted;
  • Maintaining and providing written, on-going compliance training for our employees; and
  • Auditing of our compliance regime to test its effectiveness related to money laundering and terrorist financing compliance.

2. Appointment of a Chief Anti-Money Laundering Officer

Under the Due Diligence Act requirements, Click has a chief anti-money laundering officer (“CAMLO”), who is the responsible member of the executive accountable for the implementation of our anti-money laundering and anti-terrorist financing compliance regime. The CAMLO has the authority and the resources to ensure the on-going compliance of our organization as it relates to money laundering and terrorist financing identification and prevention. The CAMLO will be the contact person for the competent supervisory authority, the Financial Market Authority (FMA), of Liechtenstein.

3. Ongoing Monitoring of Business Relationships

Click considers all accounts/wallets to be “account holders” and accordingly, follows the regulatory requirements of:

  • Risk rating all account holders;
  • Conducting ongoing monitoring of client transactions at a frequency commensurate to our clients’ risk; and
  • Keeping a record of the measures that we have taken to monitor the relationship and the information we obtained as a result.

If necessary we may require our clients to provide additional documentation or information to confirm source of funds or the purpose of the transaction. We may also amend their risk rating if the need arises.

Click’s compliance staff will review any transactions that trigger an investigation and determine if the transactions are within the clients’ stated activity before being released or completed. In some cases, Click will require additional information such as the client’s source of income, proof of employment, nature of the client’s business, as well as review of client transaction history.

4. Record Keeping

In respect of the Due Diligence Act and its accompanying Ordinance, Click is required to keep certain types of records depending on the transaction type. We must keep a record of any suspicious transaction reports submitted to the Financial Intelligence Unit (FIU) of Liechtenstein. There is no threshold (that is, no dollar amount) for a suspicious transaction. When we have to send a suspicious transaction report to the FIU, we take reasonable measures, before the transaction is reported, to ascertain the identity of the individual who conducted or attempted to conduct the transaction.

5. KYC Processes

5.1 When and how do we have to identify clients?

In general, prior to Click performing a transaction for a client, we must identify that client. Click has a policy of requiring all customers to be “verified” prior to being able to undertake any form of transactions through our Exchange. Accounts are made available to residents of the European Union and that fall under the “European Economic Area (EEA) and the three EEA EFTA States (Iceland, Liechtenstein, and Norway).

Customer may be verified by way of:

5.2  Instant Verification (Single Process Method)

We ascertain the identity of a client by referring to a client’s credit file using a third party “KYC” provider. To be verified, the credit file details must match the name, address and date of birth provided by an individual client. If any of the information does not match, the individual will flow through another method for Click to verify their identity.

5.3 Manual Verification (Dual process method)

This method involves referring to information from reliable and independent sources which can be submitted by the individual in original paper form or in electronic form. As part of the account sign up process, using a third party “KYC” provider, clients can be asked to upload original electronic or paper documents they received or downloaded. All documents must appear to be valid and unaltered in order to be acceptable. If any information has been redacted, it is not acceptable.

Customer may be verified by way of:

5.4 How to Identity Corporations and Other Entities

For corporate clients, we are required to confirm the existence of the entity, obtain it’s profile, and verify the entity’s beneficial ownership.

The corporate profile must include the name or company style, legal form, address of registered office, state of domicile, date established, place and date of entry in the Commercial Register, where applicable, and the names of the bodies or trustees acting formally on behalf of the legal entity in the relationship with the person subject to due diligence.

5.5 Registered Entities and Legal Entities that are not Registered

We confirm the existence of a corporation as well as the corporation’s name and address, by referring to the following documents:

  • Proof of existence for legal entities registered with the Commercial Register:
    • An extract from the Commercial Register issued by the Commercial Register Authorities)
    • a written extract from a database held by the Commercial Register authorities; or
    • a written extract from a reliable, privately managed directory or similar database.
  • Proof of existence of a legal entity that is not registered in the Commercial Register:
    • an official certificate issued in Liechtenstein or any other EU country that issues such certificates;
    • the statutes, the formation documents or the constitutive agreement;
    • a confirmation of the company information by the appointed auditor of the annual financial statements;
    • an official authorisation to conduct the activity; or
    • a written extract from a reliable, privately managed directory or a similar database.
  • Signing authorities – Click ascertains that each person purporting to act on behalf of the contracting party is authorised to do so by:
    • establishing the identity of such persons by documentation of those natural persons name, forename, date of birth, residential address, state of residence and nationality; and
    • verify such particulars by consulting a supporting document (original or certified copy) or by means of signature authentication.
  • It is a requirement for all clients, regardless of status, to provide evidence of origins of assets (source of funds).
  • Additional information information may be requested to support proof of existence at the request of the AML Compliance Department.

5.6  Not-For-Profit Organization

If the entity is a not-for-profit organization, which provides benefit to the community and which are verifiably exempt from income tax in their state of residence, we also have to do the following:

  • For associations and societies without legal personality that pursue charitable or non-commercial objectives, the natural persons who are members of the executive body are to be recorded in a specific regulator-required form.

5.7  Beneficial Ownership Records

In addition to confirming the existence of a corporation or other entity, we also must determine and confirm the accuracy of the entity’s beneficial ownership, as well as verify their identities in accordance with the following:

  • If the entity is a corporate structure with legal status, a Trust enterprise, or a company without legal personality:
    • The natural persons who ultimately directly and indirectly hold or control a share or voting right amounting to 25% or more of the legal entity.
    • The natural persons who ultimately directly and indirectly have a share of 25 % or more in the profits of such legal entities; or
    • The natural persons who ultimately directly and indirectly exercise control over the management of such legal entities in another way.
  • The natural persons, who are members of the executive body if – after exhausting all alternatives and provided there are no grounds for suspicion – no such person as referred to in the above can be identified.

Click is expected to not rely exclusively on the information contained in registers with particulars concerning beneficial owners. All beneficial owners are required to have the accuracy of the particulars referred confirmed by the contracting party or a person authorised by that party by means of a signature or by a secure electronic signature.

Additional detailed measures for establishing and verifying beneficial ownership are required for foundations, trusteeships and establishments with a structure similar to that of a foundation or trust enterprises.

5.8 Authentication & Language

Click requires all AML Compliance documentation to be issued in English, or translated by an approved and accepted official translation company. Click reserves the right to require specific translation services be employed for this purpose.

Where Click requires confirmation of authenticity of a copy of a confirmatory document or the authenticity of a signature, it may be issued only by a notary or another public office that normally issues such authentication documents. Click reserves the right to require specific legal or notarization services be employed for this purpose.

Certificates of authentication, register extracts and confirmations by the appointed auditor of the annual financial statements may not be more than twelve months old.

5.9 Keeping Client Identification Information Updated

We must keep our client information up to date. For clients that have a customer file with us, we will, at a minimum, update the client identification at least every two years. This is to be done by reviewing original identity documents and recording the identification details for our files as appropriate.

6. Record Maintenance

We are required to maintain an effective recordkeeping system to enable the Competent Authority to have access to the records on a reasonable timescale. Our records have to be kept in such a way that they can be provided to the Competent Authority in the event of a request to examine them.

We will keep a copy (electronic or physical) of all reports we make to the FIU. We will also keep a copy of the information that the FIU sends us in the acknowledgement message about each report processed.

The Competent Authority requires us to maintain our records for at least ten years. There are specific rules regarding the maintenance of electronic records that Click adheres to. Our records include any client information and identity records, transaction records and FIU reporting.

7. Suspicious Transaction Reports

The Company must report any transactions or attempted transaction that we suspect relates to money laundering, connected with money laundering, predicate offences to money laundering, organised crime or terrorist financing or terrorist activity financing regardless of the amount. There is no monetary threshold for submitting these reports.

The CAMLO has the authority to file STRs with the FIU and is required to maintain a log of all reports filed.

8. Terrorist Property Reporting Requirements and Sanctions

In some situations we may be required to freeze terrorist assets in the event of suspicion of terrorist financing. There are situations where we must send a terrorist property report to the FIU and any other required authority, immediately, where we knowing or believe that a property is owned or controlled by or on behalf of a listed (terrorist or sanctioned) person. Click will do so without delay.

9. Ongoing Monitoring of Business Relationships

If in the course of reviewing and monitoring, we identify unexplainable, unusual activity, patterns or have any questions, we will work to obtain further information so that these questions are satisfactorily answered and/or we will report the activity internally to the CAMLO who is required to maintain a record/log of all internally reported and perform a review to determine if an STR is to be filed with the FIU. If we have not reached a clear understanding of the sources and movement of funds, it may result in the account being permanently closed. This will be followed by terminating the relationship with the de-marketed account owner and placing them on the de-market list without the right of re-opening a new account unless authorized by the senior management and the CAMLO.

Click endeavours to keep client information current, accurate, and up to date, taking a risk-based approach in accordance with the legal requirements.

10. Audit Schedule

In accordance with the legal requirements, Click will be subject to standard inspections. The auditors must possess the required skills for the performance of inspections and must be authorised by the Competent Authority. The supervisory authority sets out more specific instructions concerning the minimum content of the inspection reports and the performance of inspections. Click will abide by these instructions.

This document was last updated on March 1, 2018